ETH Eyes $1,350 as the BTC Bulls Target a Return to $18,000 on China

Key Insights:

• On Sunday, bitcoin (BTC) and ethereum (ETH) joined the broader crypto market in the green to wrap up the week in positive territory.
• Dip buyers and a pickup in appetite for riskier assets on news of China reopening measures delivered support.
• Market conditions improved further this morning, with investors responding to further COVID-19 easing measures.

Ethereum (ETH) rose by 3.14% on Sunday. Partially reversing a 4.24% slide from Saturday, ETH ended the week up 7.24% to $1,280. Despite the bullish session, ETH fell short of $1,300 for the second time in five sessions.

Bullish throughout the session, ETH rallied from an early low of $1,240 to a final-hour high of $1,287. Coming within range of the First Major Resistance Level (R1) at $1,288, ETH eased back to end the day at $1,280.

On Sunday, bitcoin (BTC) rose by 1.41%. Reversing a 1.18% loss from Saturday, BTC ended the week up 4.21% to $17,127. The bullish session saw BTC wrap up the day at $17,000 for the third time in five sessions.

Bullish throughout the Sunday session, BTC rose from an early morning low of $16,885 to a final-hour high of $17,210.

Steering clear of the Major Support Levels, BTC broke through the First Major Resistance Level (R1) at $17,067. However, coming up short of the Second Major Resistance Level (R2) at $17,245, BTC fell back to end the day at sub-$17,200 levels.

Investor Reaction to China’s Reopening Plans Delivered Morning Support

Following Saturday’s bearish session, investor sentiment turned bullish on Sunday. Further updates on China’s reopening plans delivered support through Sunday and this morning.

This morning, Bloomberg reported on the Chinese government easing COVID-19 restrictions in Shanghai. As other parts of the country also relax containment measures, investor hopes of an economic recovery have fueled demand for riskier assets.

The Hang Seng Index and CSI300 responded to the news with gains of 3.46% and 1.73%, respectively.

However, US economic indicators and the NASDAQ Composite Index could test buyer appetite later today. A sharp fall in the ISM Non-Manufacturing PMI would fuel fears of a US economic recession that would weigh on the NASDAQ and the crypto market. On the flip side, positive numbers should deliver support, though a jump in the PMI and sub-components could question the Fed pivot theory.

Ethereum (ETH) Price Action

At the time of writing, ETH was up 1.75% to $1,302. A bullish morning saw ETH rally from an early low of $1,277 to a high of $1,304.

ETH broke through the First Major Resistance Level (R1) at $1,298.

Technical Indicators

A hold above R1 and the $1,269 pivot would support a run at the Second Major Resistance Level (R2) at $1,316. A move through last week’s high to $1,312 would signal a bullish afternoon session.

In the event of an extended rally, the bulls would likely target $1,350. The Third Major Resistance Level (R2) sits at $1,363.

A fall through R1 and the pivot would bring the First Major Support Level (S1) at $1,251 into play. However, barring an extended crypto sell-off, ETH should avoid sub-$1,250 and the Second Major Support Level (S2) at $1,222. The Third Major Support Level (S3) sits at $1,175.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bullish signal. Ethereum sat above the 200-day EMA, currently at $1,277. The 50-day EMA pulled away from the 100-day EMA, after Friday’s bullish cross, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A hold above the 200-day EMA ($1,277) would support a move through R2 ($1,316) to target $1,350. However, a fall through the 200-day ($1,277) would bring the 50-day EMA ($1,253) and S1 ($1,251) into play.

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 1.49% to $17,382. A bullish morning saw BTC rise from an early low of $17,095 to a high of $17,436.

BTC broke through the First Major Resistance Level (R1) at $17,263 and briefly through the Second Major Resistance Level (R2) at $17,399.

Technical Indicators

BTC needs to avoid a fall through R1 and the $17,074 pivot to retarget the Second Major Resistance Level (R2) at $17,399 and $17,500. A move through the morning high of $17,436 would signal a bullish afternoon session. However, the crypto news wires and US stats should be market-friendly to support a breakout session.

In the event of an extended rally, BTC would likely test the Third Major Resistance Level (R3) at $17,724 and resistance at $18,000.

A fall through R1 and the pivot would bring the First Major Support Level (S1) at $16,938 into play. Barring an extended sell-off, BTC should avoid sub-$16,500. The Second Major Support Level (S2) at $16,749 should limit the downside. The Third Major Support Level (S3) sits at $16,424.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. This morning, BTC hovered around the 200-day EMA, currently at $17,409. The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A move through R2 ($17,399) and the 200-day EMA ($17,409) would give the bulls a run at R3 ($17,724) and $18,000. However, a fall through S1 ($16,938) would bring the 100-day EMA ($16,905) and the 50-day EMA ($16,874) into view. A fall through the 50-day EMA would signal an extended sell-off.