Following the approval by the Security and Exchange Commission, all Ethereum ETF filers have released the dates they plan to go public. Most filers are looking to start on July 23.
Many traders are looking forward to the launch but are surprised at how silent the market is getting amidst the impending event. To this effect, the largest altcoin has struggled to gain stability above $3,500 as the bulls appear exhausted.
Nonetheless, the latest inability to surge after flipping $3,500 has ranged on over the last five days as the coin keeps losing momentum.
While the impending event will spark significant upside for the asset, it will also result in notable price declines.
The Two-Edged Sword
Many speculation points to the cryptocurrency hitting $4k following the ETF launch. It remains to be seen if this will play out. However, the question is, what will happen after the hype surrounding the event dies off?
Using Bitcoin as a case study, it is clear that a massive decline will soon follow. Following the launch of the BTC ETF, several filers saw a decrease in investment. The massive outflow of funds from these firms also accounted for the ensuing selloffs. The same may play in ETH’s case.
The coin may continue to struggle at $3,500 or breakout as the event hype increases. However, on-chain data supports a breakout as several metrics are bullish at this time. One such is the exchange reserve, which decreased to its lowest level in the last fourteen days during the previous intraday session.
The decline explains the over 2% price hike Ethereum saw. However, it sharply rose a few hours ago. The bulls are soaking up the excess supply, translating to the coin’s inability to break out. Many analysts argue that the sweeping up of supply will continue. They based their assertion on the past seven-day trend.
However, the metric also hints at the ongoing buildup in anticipation of a massive selloff. Exchanges are seeing a notable inflow of ETH from other sources, including cold wallets, which could indicate investors planning to dump their bags.
While all outlooks are bearish, the charts offer a glimmer of hope.
Ethereum has Room for More Uptrends.
RSI on the on-chain sector is currently high and indicates a possible trend reversal. It states that the cryptocurrency has been overbought, which means it will see a healthy number of corrections in the coming days.
However, the relative strength index on the 1-day chart suggests that the coin still has room for more surges. It is at 60, which keeps it in a safe zone. ETH may see an over 7% price hike before the metric hits 70 or breaks above it.
Nonetheless, Ether is trading above its 50-day moving average, which is serving as good support. Additionally, it is trading close to its pivot point. The bulls will look to continue the uptrend to give the PP more clearance, making it a stronger mark.
The cryptocurrency is seeing healthy buys despite the reduced volatility. The accumulation and distribution chart shows no impending moves not reflected in prices.
In the coming days, the apex altcoin will see a sharp rise following the ETF launch as the market responds favorably. The surge will affect not only ETH but all of its products and other cryptocurrencies.
A surge trend could create the needed gap away from the pivot point, giving it the much-needed strength. It may shoot as high as $3,600 but may struggle to flip it as this is another tough resistance to crack.
Nonetheless, in the event of a reversal, the cryptocurrency may retrace but find support at the 23% Fibonacci retracement level at $3,400. Failure to defend this critical support may send ETH as low as $3,200.
