ETHUSD (Ethereum) – Week 37 – Bigger correction?
Ethereum's fee structure, which brings a fee-burning mechanism to the network, is accelerating day by day due to the elevated network load and increased base fee. These caused $35 million worth of burnings in the last 24 hours, which is the record for the number of coins burned in one day. In addition to a large number of burned coins, Ethereum has added more than 6.2 million addresses to the network that hold 0.01-1 ETH since the beginning of 2021.
Large burn volume on the network inevitably led to the formation of deflationary blocks on the network. At some point, the number of deflationary blocks when less Ethereum has been mined than burned formed deflationary days. From an economic perspective, deflation works in favor of long and mid-term holders who have been able to accumulate a large number of Ethereum coins before the EIP-1559 update.
While the Bitcoin or Ethereum debate rages on between early investors and maxis, London-based bank Standard Chartered already seems to have picked a side. The bank, in a recent research note, said Ethereum could outperform Bitcoin over the next few years, even stating it ‘structurally’ values the world’s second-largest cryptocurrency by market cap at over $35,000.
From a technical perspective, Ethereum made a sharp pullback in the previous week that broke the blue channel. For this week we give a high probability for the price to retest the support area marked on the chart. If the price goes higher from here we must study the PA at resistance to decide if a retest of support will happen or the price will continue higher.
Trade with care.
Best regards,
Financial Flagship
Disclaimer: The analysis provided is purely informative and it should not be used as financial advice. Remember that you need a plan before you start trading; so, take this knowledge and use it as a guidebook that will ultimately help you understand the market and easily predict your next move.
Large burn volume on the network inevitably led to the formation of deflationary blocks on the network. At some point, the number of deflationary blocks when less Ethereum has been mined than burned formed deflationary days. From an economic perspective, deflation works in favor of long and mid-term holders who have been able to accumulate a large number of Ethereum coins before the EIP-1559 update.
While the Bitcoin or Ethereum debate rages on between early investors and maxis, London-based bank Standard Chartered already seems to have picked a side. The bank, in a recent research note, said Ethereum could outperform Bitcoin over the next few years, even stating it ‘structurally’ values the world’s second-largest cryptocurrency by market cap at over $35,000.
From a technical perspective, Ethereum made a sharp pullback in the previous week that broke the blue channel. For this week we give a high probability for the price to retest the support area marked on the chart. If the price goes higher from here we must study the PA at resistance to decide if a retest of support will happen or the price will continue higher.
Trade with care.
Best regards,
Financial Flagship
Disclaimer: The analysis provided is purely informative and it should not be used as financial advice. Remember that you need a plan before you start trading; so, take this knowledge and use it as a guidebook that will ultimately help you understand the market and easily predict your next move.
