Ethereum needs Bitcoin to rally, as it is the 2nd largest market, and it typically follows the biggest one, Bitcoin.
- Ethereum has had a quiet trading session on Tuesday, as we continue to have around the $1650 level.
- Just above, we have the $1700 level which could offer a little bit of resistance, as it is a large, round, psychologically significant figure and an area that has seen a lot of action in the past.
- That being said, the market is staying rather stagnant after a huge move, so it does suggest that perhaps we are trying to build up enough confidence to break out.
Having said that, cryptocurrencies are very difficult to trade at the moment, because risk appetite is all over the place. In order for Ethereum, Bitcoin, Cardano, or any other crypto to thrive, you need a lot of risk appetite. This typically goes right along with loose monetary conditions, which is something that the Federal Reserve is fighting at the moment. Monetary policy has been tightening over the course of several months, and it absolutely wrecked the crypto market. However, recently we’ve seen the bond market tightening monetary policy, as yields continue to rise in the United States. That being said, crypto has rallied during that timeframe. That could perhaps be a good sign because it appears that people are starting to look at crypto through the prism of what crypto may actually end up being.
Ethereum needs Bitcoin to rally, as it is the 2nd largest market, and it typically follows the biggest one, Bitcoin. From a technical analysis standpoint, the 50-Day EMA sits just below current trading, and it has just recently crossed above the 200-Day EMA, kicking off the so-called “golden cross.” With this being the case, I think the market could very well go to the $2000 level, but we obviously have a lot of work to do in this area, and therefore we need to be patient. That’s been one of the hardest things about the crypto recovery, it is taking its sweet time, but that’s nothing abnormal.
On significant pullbacks, there very well could be buyers of Ethereum and another crypto, so one would have to anticipate that most of these charts will move in synchronicity over the longer term. Ethereum recently had an upgrade, and therefore it also helps the idea of Ethereum picking up value. Whether or not the next major bull run is about to start is a completely different question, but it certainly looks as if we have seen the worst of the selling pressure disappear.
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