Ethereum Price eyes $4k after five straight days of gains
The Ethereum price has surged 25% since Thursday as buyers return to the market for the seasonally strong last three months of the year. Ethereum (ETH) started September exceptionally well, and by the 3rd, ETH was changing hands at $4,030 and on course for may’s $4,383 high. However, by the 21st, Ethereum was 35% lower, trading at $2,650 and close to breaking down before Fed Chair Jerome Powell saved the day.
On the 6th of September, cryptocurrencies sold off hard following Chinese property developer Evergande’s default. Bitcoin (BTC) slid $10,000, losing almost 20% intraday, and Ethereum erased 25% before paring the loss to 13%. The Ethereum price stabilised over the next week, adding 20% to $3,675 and appeared to be on track to recover $4,000. However, on the 20th, the Peoples Bank of China (PBOC) rattled the market when its website announced all crypto transactions are banned in the country, including outside firms offering services to Chinese citizens. Binance (BNB) immediately withdrew support for mainland Chinese clients, and cryptos succumbed to heavy liquidation. Subsequently, Ethereum lost 20% in 48 hours before finding support at the 200-day moving average at $2,589. ETH spent most of the following week consolidating in the $2,800-$3,200 range before last weeks uplift.
On Thursday, the 30th, Fed Chair Jerome Powell gave the crypto market a lift when he revealed he has no plans to follow China’s lead and outlaw cryptocurrencies. The market immediately reacted higher, Bitcoin jumped 20% to $49,300 on Sunday, and Ethereum gained $3,489. This morning, the Ethereum price is softer by around 4% to $3,370.
Ethereum price Chart (Daily)
The daily chart shows that during the downturn at the end of last month, ETH held above the 100-day moving average at $2,842 and the 200-day at $2,672. As a result, the indicators remain the superior support levels, and as long as Ethereum price respects the DMA’s, the outlook is constructive. Additionally, ETH has also reclaimed the 50 DMA at $3,298, reinforcing the bullish momentum.
However, the price is running into overhead resistance towards the September 15th high at $3,630. Furthermore, the ETH/BTC pair has found trend resistance at $0.071, which may initiate ETH selling. Traders should be mindful of the ETH/BTC cross as an upside breakout should lead Ethereum higher vs the dollar. Furthermore, if Ethereumm clears $3,630, it should extend towards the September $4,030. However, if the broader market continues higher this week, Ethereum may outperform and kick on to the all-time high. That being said, because of the magnitude of the recent rally and increasing macro headwinds, traders should remain cautious. Therefore, the bullish thesis becomes invalid if the Ethereum price drops below the 200-day moving average at $2,672.