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June 18, 2024
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Why Staying Above $1,600 Is A Bullish Indicator For Ethereum: Here’s The Next Resistance For ETH Price

The post Why Staying Above $1,600 Is A Bullish Indicator For Ethereum: Here’s The Next Resistance For ETH Price appeared first on Coinpedia Fintech News

As Bitcoin price faces challenges, Ethereum stands out with its ongoing recovery rally, encountering minimal obstacles. Additionally, the U.S. Bureau of Labor Statistics’ August CPI data revealed a 3.7% year-on-year inflation rate, inducing volatility for BTC around the $26K mark. In contrast, Ethereum remains largely stable, backed by a growing buying interest among investors.

1073K ETH Left Exchanges

Recent data from IntoTheBlock has uncovered a surprising development: a staggering 1073000 ETH ($1.7 billion) has been withdrawn from exchanges. This significant outflow of Ethereum is unexpected, particularly in light of the altcoin’s recent market trend.

The massive withdrawal may signal a bullish outlook, suggesting that investors are accumulating Ethereum for long-term holding. However, it’s important to acknowledge that Ethereum’s historical performance has been bearish, casting some doubt on the accumulation hypothesis, though not entirely dismissing it. Investors could be seizing this as a favorable opportunity to acquire Ethereum at a more affordable rate. 

According to options data, there’s been a notable uptick in call options in the $1,600-$1,625 price range. Yet, with a put/call ratio of 0.99, it appears that bearish traders are also hedging for a potential drop to $1,500. The total open interest stands at 15,130, with a notional value of $24.3 million.

If Ethereum successfully holds its ground within the so-called “max pain” range of $1,600-$1,625, we could anticipate more upward trajectory in the days to come. Examining the past week’s trade breakdown, call holders seem to have the upper hand, suggesting a bullish trend. In the last seven days, 34.5% of positions were in call options, while put options accounted for nearly half that number at just 18.3%.

This data points to a generally bullish mood among traders and large investors as Ethereum sustains its price above the $1,600 level.

What’s Next For ETH Price?

Ethereum has shown a solid recovery over the last few hours as bulls try to hold momentum above $1,600 to escape the fear zone. However, bears are attempting to reverse the trend near the EMA50 trend line. As of writing, ETH price trades at $1,601, surging over 0.53% from yesterday’s rate. 

The inability of bullish traders to surpass the resistance of the 50-day EMA heightens the possibility of a downward slide. If the price falls below the immediate support of $1,576, the ETH price may revisit a low of $1,530. Investors are likely to buy aggressively at this dip, as a breach of this support could result in a sharp drop to $1,460.

To defend a potential decline, bulls must first push the price above the trend line and then aim for a surge towards the 200-day EMA at $1,678. Achieving this could stabilize the price within a bullish region, creating possibilities of a further surge toward $1,850. 

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