• Ethereum's price often takes a downward shift after FTX and Alameda sells ETH.
  • Traders expect a price rise in ETH following reduced long liquidations and normalizing risk reversals.
  • Ethereum needs increased trading volume to break past key resistance levels.

Ethereum (ETH) has continued showing signs of a potential rally on Tuesday as most coins in the crypto market are also posting gains. This comes amid speculation of a potential decline following FTX ETH sales and normalizing ETH risk reversals.

Also read: Ethereum shows signs of a potential rally as suspected Justin Sun wallet buys heavily

Daily digest market movers: FTX sale, normalized risk reversals, active wallet increase

Ethereum's latest price movement is hinting at a potential rally. Here are key market movers driving the second-largest cryptocurrency:

  • Since March 1, FTX and Alameda Research have deposited 20,350 ETH at strategic points right before a price dip, according to Spot On Chain. This insight comes as FTX and Alameda deposited 4,500 ETH worth $14.4 million to Binance and Coinbase at $3,207 on Tuesday. Investors may need to observe if ETH will take a downturn as in previous times. Other investors may be using FTX's move as a sell signal, hence the consistent price drop after the firm's ETH sales.
     
  • With ETH's recent price recovery, long traders are looking to gain control as long liquidations have slowed down significantly on Tuesday compared to the past two weeks, according to data from Coinglass. Short liquidations are increasing, with over $13.45 million liquidated, while long liquidations sit at $7.4 million in the past 24 hours.

    ETH risk reversals have also normalized above -4%, from -12% one week ago, indicating traders are beginning to expect a price improvement, according to QCP Capital. As a result, "improving speculative sentiment could see short covering and a resumption of leveraged longs," said QCP.

Read more: Ethereum resumes consolidation after brief dip, buyback yield exceeds that of major S&P 500 companies

  • Meanwhile, Bankless podcast co-host Ryan Sean Adams pointed out the increasing number of active wallets in the Ethereum ecosystem, which has grown to over 10 million weekly active wallets. He speculated that the Ethereum ecosystem can now increase user growth by 10x to 100 million in this bull run.
     
  • The US Securities & Exchange Commission (SEC) has also delayed its response to Franklin Ethereum ETFs, a series of the Franklin Ethereum Trust. The latest spot Ethereum ETF decision delay follows a series of timeline delays the regulator has given to other applicants.

Technical analysis: Ethereum needs increased volume to break past key resistance

Ethereum's recent price movement is teasing that a potential rally is on the horizon as it's attempting to break the upper side of the $2,852 and $3,300 key range. But it must first move past the $3,279 resistance to confirm.

Also read: Ethereum shows firm support at key level as its correlation with US indices increase

However, declining trading volume amid the price increase is a concern. While bulls appear to have taken the wheels again, the reduced trading volume indicates low commitment and uncertainty. ETH could quickly push forward to break past the $3,300 key level if increased volume accompanies the rising bullish sentiment.

ETH/USDT 4-hour chart

ETH/USDT 4-hour chart

Such a move will see ETH filling the liquidity void of April 13 and aiming for the next resistance of $3,406 formed on April 7. This resistance may prove easy to break past if trading volume increases. However, if volume fails to increase, ETH may fall back to the $3,056 support of March 20.

Additionally, with the halving behind us, Bitcoin's dominance over ETH may reduce in the long term, leaving room for the largest altcoin to craft its own path.

Ethereum is trading around $3,232, up 1.3% on the day at the time of writing.

Ethereum FAQs

Ethereum is a decentralized open-source blockchain with smart contracts functionality. Serving as the basal network for the Ether (ETH) cryptocurrency, it is the second largest crypto and largest altcoin by market capitalization. The Ethereum network is tailored for scalability, programmability, security, and decentralization, attributes that make it popular among developers.

Ethereum uses decentralized blockchain technology, where developers can build and deploy applications that are independent of the central authority. To make this easier, the network has a programming language in place, which helps users create self-executing smart contracts. A smart contract is basically a code that can be verified and allows inter-user transactions.

Staking is a process where investors grow their portfolios by locking their assets for a specified duration instead of selling them. It is used by most blockchains, especially the ones that employ Proof-of-Stake (PoS) mechanism, with users earning rewards as an incentive for committing their tokens. For most long-term cryptocurrency holders, staking is a strategy to make passive income from your assets, putting them to work in exchange for reward generation.

Ethereum transitioned from a Proof-of-Work (PoW) to a Proof-of-Stake (PoS) mechanism in an event christened “The Merge.” The transformation came as the network wanted to achieve more security, cut down on energy consumption by 99.95%, and execute new scaling solutions with a possible threshold of 100,000 transactions per second. With PoS, there are less entry barriers for miners considering the reduced energy demands.

 


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Join Telegram

Recommended content


Recommended Content

Editors’ Picks

Solana and XRP ETFs may be on the cards in 2025, Standard Chartered analyst says

Solana and XRP ETFs may be on the cards in 2025, Standard Chartered analyst says

Ethereum Exchange Traded Fund approval news has renewed optimism on Solana and XRP ETFs approval in 2025. Analysts at Standard Chartered believe more cryptocurrency ETFs may be approved next year, and these assets will not be classified as securities. 

More Solana News

Uniswap Price Forecast: UNI could be poised for 30% rally after month-long lull

Uniswap Price Forecast: UNI could be poised for 30% rally after month-long lull

Uniswap price has broken out of a 35-day consolidation this week, a sign of a possible rally ahead that could increase the token’s price around 30%. Technical indicators support the bullish thesis, while on-chain data also aligns with it.

More Uniswap News

Dogecoin inspiration Kabosu dies, leaving legacy of $22.86 billion market cap meme coin behind

Dogecoin inspiration Kabosu dies, leaving legacy of $22.86 billion market cap meme coin behind

Kabosu, the popular Shiba Inu dog that inspired the logo of the largest meme coin by market capitalization, Dogecoin, died early on Friday after losing her fight to leukemia and liver disease. Kabosu had gained popularity as the dog behind the viral “doge” meme. 

More Dogecoin News

XRP climbs past $0.53, SEC Chair Gensler says the agency has done very well in court cases

XRP climbs past $0.53, SEC Chair Gensler says the agency has done very well in court cases

Ripple lawsuit ruling is expected soon, following the new US crypto bill, FIT21. SEC Chair Gary Gensler says the agency has fared well in legal battles while speaking at the ICI 2024 Leadership Summit. 

More Ripple News

Bitcoin: BTC struggles, but $80K is at striking distance Premium

Bitcoin: BTC struggles, but $80K is at striking distance

Bitcoin (BTC) price is in a good position to resume the bull rally despite the recent struggle. Optimism will restart if BTC overcomes a critical hurdle and flips it into a foothold. In such a case, the pioneer crypto will be slated to push to a new all-time high (ATH). 

Read full analysis

BTC

ETH

XRP