Taking a look at
ETHUSD
over the past two years can paint a better picture of what to expect going into the rest of the year.
Fundamentals-
Crypto has been taking a hit with the US stock market. This is a result of global sentiment shifting away from growth risk with impending rate raises from the Federal Reserve and other central banks. The coupling with growth stocks has been a hamper on Ethereum's value as an inflation hedge and negative correlation against the DXY has been spotty at best. One big concern for ETH has been the drastic increase in gas prices as it becomes more mainstream with NFT's. However, addition of Bitcoin to Central American economies has given further "Institutional Support" to crypto. With these correlations and fundamentals considered I hold a near term bullish bias on Crypto but my longer term take is that this market could still see some more downside in the next 6 months as these rate hikes go into place.
Technicals-
Ethereum has traded back to its value for the past two years which represents the most traded price in this range. In light of this I expect the market to find some support. It has established its monthly point of control right above this area which is promising for bulls. I expect for the market to continue to find buyers in this range and rally into the 2998. From there I am a bit more skeptical of continuation. After a test of 2998, the bullish pivot at 3259 would need to be firmly reclaimed. From there, the market could push back into the last stand at 3493. If breached it is highly likely to create a suction back into its established range at 3721-4875. The bear case and my prediction is a retest of 2998 and a move below value towards 1997-1879. I would looking at more long term buys in that demand zone. A selloff below 1879 becomes very dangerous for ETH with 1681 representing June and July Lows potentially coming into play. Offers below this level would be max pain for crypto from an option chain/leveraged positioning stand point. A break below 1681 would lead to cascading liquidations into 1599, 1237, 720 not unlike moves we have already seen.
ETHUSD
over the past two years can paint a better picture of what to expect going into the rest of the year. Fundamentals-
Crypto has been taking a hit with the US stock market. This is a result of global sentiment shifting away from growth risk with impending rate raises from the Federal Reserve and other central banks. The coupling with growth stocks has been a hamper on Ethereum's value as an inflation hedge and negative correlation against the DXY has been spotty at best. One big concern for ETH has been the drastic increase in gas prices as it becomes more mainstream with NFT's. However, addition of Bitcoin to Central American economies has given further "Institutional Support" to crypto. With these correlations and fundamentals considered I hold a near term bullish bias on Crypto but my longer term take is that this market could still see some more downside in the next 6 months as these rate hikes go into place.
Technicals-
Ethereum has traded back to its value for the past two years which represents the most traded price in this range. In light of this I expect the market to find some support. It has established its monthly point of control right above this area which is promising for bulls. I expect for the market to continue to find buyers in this range and rally into the 2998. From there I am a bit more skeptical of continuation. After a test of 2998, the bullish pivot at 3259 would need to be firmly reclaimed. From there, the market could push back into the last stand at 3493. If breached it is highly likely to create a suction back into its established range at 3721-4875. The bear case and my prediction is a retest of 2998 and a move below value towards 1997-1879. I would looking at more long term buys in that demand zone. A selloff below 1879 becomes very dangerous for ETH with 1681 representing June and July Lows potentially coming into play. Offers below this level would be max pain for crypto from an option chain/leveraged positioning stand point. A break below 1681 would lead to cascading liquidations into 1599, 1237, 720 not unlike moves we have already seen.
