ETH Needs a Spike in Staking Inflows to Support a Run at $1,900

Key Insights:

• On Saturday, ETH gained 0.16% to end the day at $1,831.
• News from Washington on the debt ceiling provided support while staking inflows weighed.
• The technical indicators are bullish, signaling a run at $1,900.

Ethereum (ETH) rose by 0.16% on Saturday. Following a 1.22% gain on Friday, ETH ended the day at $1,831. Despite the bullish session, ETH fell short of the $1,850 handle for the third consecutive session.

A bullish start to the day saw ETH rise to an early morning high of $1,837. Falling short of the First Major Resistance Level (R1) at $1,846, ETH fell to an early afternoon low of $1,813. However, steering clear of the First Major Support Level (S1) at $1,804, ETH bounced back to end the day at $1,831.

US Debt Ceiling News Delivered Support

According to CryptoQuant, staking inflows tumbled from 161,248 ETH on Friday to 70,208 ETH on Saturday. The marked decline weighed on buyer appetite. However, inflows remained elevated relative to other weekend levels, limiting the impact on ETH.

The total value staked climbed higher, despite the pullback in staking inflows.

The overnight withdrawal profile was also bearish. Overnight, principal withdrawals spiked to above-normal levels. However, withdrawal projections for the morning session were bullish, with principal ETH withdrawals expected to tumble.

On Saturday, the net staking balance surged from a surplus of 58,560 ETH on Friday to a 157,700 ETH surplus, equivalent to $286.80 million. Deposits totaled 174,260 ETH versus withdrawals of 16,560 ETH.

According to TokenUnlocks, total pending withdrawals stood at 23,960 ETH, equivalent to approximately $44.31 million. Notably, the staking APR stood at 8.71%, up 1.16% over 24 hours.

Beyond the crypto market, reports of US President Joe Biden and Speaker of the House Kevin McCarthy reaching a debt ceiling deal delivered late support. However, market sentiment toward the Fed and the June interest rate decision capped the upside.

According to the CME FedWatch Tool, the probability of a June hike increased from 51.7% to 64.2% on Friday.

The Day Ahead

It is a quieter day for ETH. There are no US economic indicators to distract investors, leaving investors to consider the debt ceiling deal and the Fed monetary policy outlook.

However, staking statistics and the withdrawal profile will continue to influence. A further fall in staking inflows and a spike in withdrawals would deliver a bearish session.

SEC v Ripple updates and Binance and Coinbase (COIN)-related news would also move the dial.

Ethereum Price Action

This morning, ETH was up 1.06% to $1,850. A mixed start to the day saw ETH fall to an early low of $1,824 before rising to a high of $1,860. ETH broke through the First Major Resistance Level (R1) at $1,841 and briefly through the Second Major Resistance Level (R2) at $1,851.

ETH Technical Indicators

Resistance & Support Levels

ETH needs to avoid a fall through R1 and the $1,827 pivot to retarget the Second Major Resistance Level (R2) at $1,851 and the morning high of $1,860. A move through R2 and the morning high of $1,860 would signal a breakout session. However, staking statistics and the crypto news wires must support a bullish session.

In the event of an extended rally, the bulls would likely test the Third Major Resistance Level (R3) at $1,875 and resistance at $1,900.\

A fall through the pivot would bring the First Major Support Level (S1) at $1,804 into play. However, barring a risk-off-fueled sell-off, ETH should avoid sub-$1,800. The Second Major Support Level (S2) at $1,803 should limit the downside. The Third Major Support Level (S3) sits at $1,779.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. Ethereum sat above the 200-day EMA, currently at $1,839. 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 hold above the 200-day ($1,839) would support a breakout from R2 ($1,851) to target R3 ($1,875) and $1,900. However, a fall through R1 ($1,841) and the 200-day EMA ($1,839) would bring the 100-day ($1,826) and 50-day ($1,822) EMAs and S1 ($1,817) into view.

A fall through the 50-day EMA would send a bearish signal.