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Ethereum Price Forecast – ETH Killing Time After Rally

By:
Christopher Lewis

Ethereum has done very little early on Wednesday, as we continue to sort out whether or not we can continue to see the upward momentum.

Ethereum logo, FX Empire

In this article:

Ethereum Forecast Video for 07.12.23

Ethereum Technical Analysis

Ethereum has gone back and forth during the trading session on Wednesday, as we may be killing time heading into the 2nd half of the week. After all, we have broken out pretty significantly, and therefore it’s likely that we need to work off some of the excess froth. Furthermore, Ethereum tends to take its lead from the Bitcoin market, which is most certainly stretched simultaneously.

All that being said, the market looks as if the $2100 level underneath will continue to be important, as it was previous resistance. By breaking out above there, it allows traders to put more money to work, and it also sets up as a potential support level on a pullback. After all, a bit of “market memory” could come into the picture, and therefore I think you have to look at it through that prism. I am a buyer in general, but I also would like to find some type of value in order to get involved. Ultimately, I do think that it’s probably only a matter of time before breakout to higher levels and go look into the $2500 level, but you need to keep an eye on the bond market.

Crypto has shown itself to be extraordinarily vulnerable to higher interest rates, therefore I think you have to keep an eye on the 10 year yield. After all, crypto needs a lot of “hot money” coming into the market to continue to push prices higher. It’s not a normal investment, it’s a bet on a future which is extraordinarily volatile and highly unknown. In other words, when it comes to trading along the financial spectrum, this is about as far out as you can possibly get. Granted, it does offer higher returns at times, but it can also offer higher losses. Because of this, you need to be cautious with position sizing, so chasing or getting involved in a “FOMO trade”, has been the death of many crypto geniuses.

A little bit of patience and value could go a long way in this market, and I believe at this point in time the “floor in the market” is closer to the $1925 level, the bottom of the previous consolidation area and where the 50-Day EMA hangs about.

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About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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