- Ethereum bulls take a break as the market cools off after a massive rally.
- CME's ETH future listing causes a chasm within the cryptocurrency community regarding an incoming price crash.
- On-chain transactional data suggests a bounce is likely due to strong buyers' concentration around the current price levels.
Ethereum price has seen an impressive 135% rally since the beginning of the year. Now that ETH has surpassed its previous all-time high of $1,400, everything seems to be lining up for an upswing towards $2,000 or higher.
CME's listing increases fears among investors
Chicago Mercantile Exchange (CME) recently announced the listing of Ethereum futures on February 8. As this date nears, the cryptocurrency community is divided into two sectors, those that believe that ETH price will crash after the listing and others who think that it will continue trending upward.
Alex Kruger, a renowned technical analyst, belongs to the latter group. Kruger maintains that the market is "now more mature" than when CME listed Bitcoin in December 2017. The prominent chartist also believes that ETH is a high beta asset that follows Bitcoin price action.
On the other hand, JPMorgan Chase's global market strategist, Nikolaos Panigirtzoglou, isn't as optimistic as Kruger. He noted on February 2 that initial volumes are likely to be low and added that the listing could witness "negative price dynamics."
For most of December and January, Grayscale stayed away from Ethereum, expecting a significant downswing in prices. However, the investing company has started accumulating ETH as the CME's listing date approaches.
Grayscale now holds over 3 million in ETH with more than $4 billion.
Ethereum price targets $2,000
As the over-leveraged market takes a break, Ethereum is now trading outside of an ascending triangle on the 1-day chart. Since the break out of this technical pattern, ETH price has risen by 21%.
Despite the significant gains incurred, its uptrend is far from over.
ETH/USD 1-day chart
If bulls can defend $1,650, ETH will likely continue climbing towards $2,000 or higher.
Based on IntoTheBlock's In/Out of the Money Around price (IOMAP) model, holding above this critical support level will be easy. This on-chain metric shows buyers' strong presence between $1,500 and $1,650, where roughly over 400,000 addresses previously purchased nearly 10 million ETH.
Investors around this area deem Ether as a good investment opportunity. Hence, any short term pressure is likely to be cushioned by such holders who may purchase more tokens around this price level.
Ethereum IOMAP chart
While everything seems bullish for Ethereum, one bearish scenario, in particular, cannot be neglected. A crash in Ethereum price following the listing of CME's ETH futures could cause a price collapse below the $1,650 support zone.
If this were to happen, it could set ETH back anywhere between 5% to 15%. The global IOMAP shows strong support at $1,300. Here, 3.35 million addresses bought around 23 million Ether.
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.
Recommended Content
Editors’ Picks
Ripple whales prevent XRP decline after soaking $4 billion in sell pressure from realized profits
Ripple's XRP is down 5% on Tuesday after news of South Korea declaring martial law sparked a surge in selling activity and significant profit-taking among investors. However, whales have stepped up buying pressure as the token looks to stage a recovery.
Paul Atkins shows reluctance to replace SEC Chair Gary Gensler
Donald Trump's transition team is yet to find a candidate to replace Gary Gensler as SEC Chair in January. Paul Atkins, the favorite to replace Gensler, has reportedly shown reluctance toward the position. Other top choices for SEC Chair include Teresa Goody Guillén, Brian Brooks and Robert Stebbins.
Crypto Today: BTC holds $95K, Cardano sets $700M record, Tron and Avalanche advance.
Bitcoin price consolidated around the $95,000 mark on Tuesday, as traders continue to rotate profits towards the altcoin markets. Positive sentiment surrounding potential altcoin ETF approvals in 2025 has sparked a major accumulation wave across the altcoin markets.
Dogecoin Price Forecast: Traders move $380M as DOGE mirrors Bitcoin’s pullback
Dogecoin price continues to consolidate below the $0.40 level on Tuesday, down 16% within the daily timeframe. After multiple failed attempts at breaching $0.50 over the past week, speculative traders have moved to scale down their DOGE positions.
Bitcoin: A healthy correction
Bitcoin (BTC) experienced a 7% correction earlier in the week, dropping to $90,791 on Tuesday before recovering to $97,000 by Friday. On-chain data suggests a modest rebound in institutional demand, with holders buying the dip. A recent report indicates BTC remains undervalued, projecting a potential rally toward $146K.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.