Critical moment for the bulls of the prince of cryptos! “Last week got off to a bad start. But despite a rise in the dollar and bond rates, the price of Ethereum (ETH) has rebounded against all odds to the point that it is approaching major resistance. If at first glance, this divergence could be a good surprise, the bulls should avoid any too hasty satisfaction.
Although the latest technical analysis would lead to believe in a new boost to the upside, neutralizing the bear market of the prince of cryptos requires other catalysts that can force the bears to put their first knee on the ground. And in this regard, we are unfortunately seeing the first signs of doubt about the possibility of returning inflation in the United States to pre-Covid levels. Especially since the FED made no secret of the fact that new increases would be on the agenda during the next meetings.
In a market context where the short-term trend remains bullish, let’s review the possible scenarios for Ethereum price, including one that could partially erase the stigma of FTX’s bankruptcy.
As it was about to return to the contact of $1400, the price of Ethereum suddenly resumed its march forward towards $1700. Meanwhile, with a prior lag of 26 weeks, the Chikou Span remains above the Tenkan and price action. For the moment, the bulls keep control of the situation as long as the prince of cryptos does not push the first alert zone which is around $1400.
Starting the week with an open near major resistance would increase the chances of ending the simultaneous status quo for ETH price and the Chikou Span below the Kumo (Ichimoku Cloud) since May 2022. Nevertheless, caution remains in order. On the one hand, the Tenkan and the Kijun are struggling to begin their rebound in weekly units. And on the other hand, as we mentioned in previous market points, the status quo of the Chikou Span below the Kumo is likely to persist for several weeks or monthsdespite a continued rebound.
Assuming the bulls resolutely engage $1700, we could see a return of the Ethereum price inside the cloud. Or more precisely in an area that would be conducive to a neutralization of its bear run since its last ATH in November 2021. Better still, we would validate a throwback on $1400 after that of $1200, then crossing the descending line. In which case, the bears could find themselves in an uncomfortable situation.
Conversely, the bulls would potentially waste their last chance. With the fear that a second test on the $1400 will not be enough. Under these conditions, the rebound from 1er January would have lead in the wing. So much so that prices could revisit FTX bargain levels, not far from the $1200 support.
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Ethereum in daily units – Will the prince of cryptos step up a gear?
A week ago, Ethereum price was below the Tenkan and Kijun in daily units, then was close to slipping inside the Kumo in the event of a return towards $1400. Finally, the sessions of February 15 and 16 made it possible to stop the consolidation, which in reality would perhaps be a breath of fresh air for the bulls. Indeed, the prince of cryptos has risen to the resistance of $1700. But afterwards, it is clear that he hesitates to move up a gear.
This in no way detracts from the favorable position of prices and the Chikou Span beyond the Ichimoku cloud. Not to mention that we now have an ETH that has managed to bounce off two key supports or two consecutive throwbacks on $1200 and $1400. These signals would maintain the hope of a crossing of $1700 at which the bulls would see a first clearing.
In this sense, the Tenkan and the Kijun would rise again in the same way as the price of Ethereum. Which would lead us to a rebound towards $2000a level that the prince of cryptos has not seen since mid-August. And if the bulls would feel their wings grow, they could consider the $2,300. This resistance represents to within about thirty dollars, the 50% of the Fibonacci retracements of the last major wave of the correction.
In the event of a new failure below $1700, the price of ETH could go back below the Tenkan and the Kijun at first before eventually landing in the direction of $1400 and Kumo. Suppose a breakout of $1400 occurs, the chart situation of the prince of cryptos in daily units would not please the bulls. And for good reason, prices and the Chikou Span would be below the Kumo with the fear that the bears would have it under their feet.
In summary, the attention of the bulls is currently focused on a possible crossing of $1700 in the days/weeks to come. If this technical scenario were to materialize, the neutralization of Ethereum’s bear run since its last ATH in November 2021 would gain momentum. On the sine qua non condition that the prices also overcome the symbolic bar of $2,000 and enter the Kumo.
However, cryptocurrency investors would do well to be on their guard. Because fundamentally, everything remains extremely hypothetical. The end of the Fed’s monetary tightening does not appear to be any time soon. As a result, certain direct or indirect components of inflation in the United States remain high.
Therefore, if the rebound in the dollar and bond rates amplified again, we would fear that Ethereum would not be done with its bear run. In which case, we should be vigilant about a potential consolidation below $1200, and especially the lows of last year around $1000.