Ethereum (ETH) has gone up by nearly 3% in the past 24 hours following yesterday’s rate hike, as the market seems ready to shake off macroeconomic woes.
In what seems to be the opposite of a “sell the news” moment, cryptos are rallying on the back of hawkish comments from the head of the U.S. Federal Reserve, Kevin Warsh.
Even though this was the first interest rate increase since 2023, and potentially the first of others to come, the Fed’s move was largely priced into crypto valuations ahead of the FOMC meeting.
Market Had Already Priced In a Rate Hike — Is This a “Buy the News” Moment?
Odds of a rate hike climbed to as high as 93% just days before officials from the central bank convened.
Meanwhile, the crypto market was also pricing in a second rate hike by December, and that continues to be the case, as data from FedWatch indicates that odds of this upcoming rate increase are currently sitting at nearly 90%.
The market was probably expecting a strong correction following Warsh’s presser, but, as it tends to happen, the reaction was counterintuitive. The price of ETH rallied off its session lows of $2,370, and it is currently climbing to $2,470.
Net inflows to exchange-traded funds (ETFs) turned negative in the past couple of days ahead of the Fed’s decision. Investors withdrew $265 million from these vehicles during this period, keeping monthly inflows at significantly low levels compared to August.
The market seems to be struggling to find a reason to keep last month’s rally going, but a historical “buy” signal is about to pop up, as trading volumes have surged in the past few weeks.
Ethereum Trading Volumes Are About to Flash a Historical “Buy” Signal
We have been tracking volumes for months, as a bullish crossover between the 7-day and 30-day moving averages for this metric has marked the beginning of three previous strong rallies for Ethereum.
According to data from Santiment, the two lines have shortened their distance significantly, and the latest developments could result in the first crossover since July 2025 — back when ETH rallied from $3,300 to $4,750.
The failed vote on the Clarity Act, the SEC’s commitment to support the crypto sector via market-specific regulations, and the Fed’s renewed dot plot have taken off the table the most uncertain elements that have prevented the market from further rallying.
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See all Ethereum forecastsETH Bounces Off $2,400 Despite Macroeconomic Woes
Turning to the daily chart, ETH has formed a bull flag pattern that is still in play after the token bounced off the $2,400 support. A similar setup emerged during last year’s April-May consolidation, the one that preceded Ethereum’s push to a new all-time high.
Hence, if the price breaks past the upper bound of the flag, currently sitting at $2,550, we expect that the next leg up should commence, setting the top altcoin on track to hit $3,300 at least in the next few weeks.
Momentum remains on the side of bulls, as the Relative Strength Index (RSI) continues to sit above the 55 mark.
That said, if the dollar rallies beyond the market’s expectations as a result of these higher rates, that may weigh on ETH’s performance and could push the token down to its 200-day exponential moving average (EMA) before the rally resumes.
