Similarly to Bitcoin, Ethereum has faced significant downward pressure due to regulatory actions taken by the SEC. However, the less hawkish expectations regarding the Federal Reserve's interest rate trajectory have provided some support, preventing the price from falling below the 1681 support level. Right now, the focus is on economic data , as it holds the key to future developments.
Should the economic data continue to demonstrate strength, leading to a sustained period of higher inflation, it is likely that the Fed will respond with further tightening measures. This would remove the support that has thus far kept Ethereum resilient. Conversely, if the data continues to disappoint, there may be some short-term upward movement due to a dovish market sentiment. However, it's important to note that an eventual recession could trigger a sell-off in Ethereum.
Ethereum Technical Analysis – Daily Timeframe
On the daily chart, we can see that the big divergence with the MACD eventually led to a big pullback in Ethereum which is slowly falling into the key 1681 support level where we can also find confluence with the 61.8% Fibonacci retracement level. There are likely to be strong buyers waiting there for another rally towards new highs. A break below the support level would spell trouble for Ethereum and lead to a selloff into the 1400 level.
Ethereum Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that at the moment Ethereum is consolidating around the 1750 level. We have a resistance level at 1778 and a downward trendline. A break above the resistance should give the buyers the confidence to target the 1925 high. The sellers, on the other hand, would be better off waiting for the price to break below the 1681 support before piling in with more conviction and target the 1400 level.
Ethereum Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that Ethereum has been ranging in the past few days as the market is waiting for the FOMC rate decision today and more economic data. If the support level breaks, there’s not much room for the sellers until they find strong resistance from the buyers leaning on the 1681 level.
