ETH Hits 30-Day High on ETF Buzz, Indicators Signal Caution

In a significant market move, Ethereum (ETH) mirrors a bullish trend, nudging a stable $1,800. The upswing follows buzzing anticipation around potential U.S. approvals of spot Bitcoin and Ethereum ETFs. Moreover, heightened Ethereum whale activity signals robust rally backing.

As a result, despite kicking off the day with an intra-day low of $1,781.04, a bullish mood has prevailed throughout the previous 24 hours. The bullish momentum successfully drove the ETH price to a 30-day high of $1,865.10, although it ran into some resistance. At press time, the bulls were still in charge of the ETH market, resulting in a 1.50% rise to $1,815.91.

ETH/USD 30-day price chart (source: Coinstats)

ETH’s market capitalization increased by 1.49% during the surge to $218,381,367,194, but its 24-hour trading volume decreased by 0.18% to $11,346,770,277. This decrease in trading volume might be attributable to profit-taking by those investors who profited from the price increase. However, the general optimistic attitude and bullish momentum suggest that there is still substantial market support for ETH.

Grayscale’s Ethereum ETF Sparks Market Optimism

On October 24, excitement enveloped the crypto market as the U.S. Securities and Exchange Commission (SEC) recognized Grayscale Investments’ Ethereum ETF application. The decision came in compliance with a direct court directive, putting Grayscale’s ETF under review. Consequently, the market is rife with speculation, anticipating the SEC might green-light a spot Bitcoin ETF by early 2024.

Such a landmark approval for Bitcoin sets a positive precedent, with a ripple effect likely for Ethereum. Analysts project that following a Bitcoin nod, Ethereum could be next in line, potentially within the next 6 to 12 months. Significantly, Ethereum’s appeal to institutional investors is multi-fold, thanks to its ESG compliance and attractive native staking yields.

ETH is probably the best 6 to 12m long among large cap assets now when BlackRock applies for spot ETH ETF 6 to 12m down the road. Ethereum’s ESG friendliness and native staking yield will be appealing to institutional investors should BTC spot ETF turn out to be a success.

— Arthur (@Arthur_0x) October 24, 2023

Whale Transactions and Short Liquidations Fuel ETH’s Ascent

Aligning with the ETF buzz, Ethereum’s ecosystem is witnessing a surge in whale transactions. Data from Santiment highlights a 15% jump in Ether transactions over $100,000, marking a three-month peak.

In addition, whale accumulations affirm support for Ethereum’s rally. These large investors are notably moving their ETH holdings off exchanges, indicative of a long-term bullish stance.

$ETH / $USD – Macro bearish case

Bearish case would see us gain momentum then pump up to tap $2,500 resistance zone, distribute then come back down going into halving next year

Something i am keeping mind, but of course i would prefer the straight up moon version pic.twitter.com/1rStyJFGP3

— Crypto Tony (@CryptoTony__) October 26, 2023

Additionally, the market observed short liquidations exceeding $70 million, further propelling ETH prices. In contrast, liquidations of long positions stood at around $41 million, underscoring the strength of the ongoing rally.

In the whirlwind of these market activities, Ethereum’s price action responds positively. Short sellers, caught off-guard, are contributing to the momentum, inadvertently boosting prices as they scramble to cover their positions. The ETH price, consequently, breached the $1,850 barrier on October 24.

ETH/USD Technical Analysis

On the ETH price chart, the Chaikin Money Flow (CMF) rating of 0.03 and pointing downwards indicate that the bullish momentum is fading. This pattern suggests that there may be less purchasing pressure and more selling pressure for Ethereum.

A diminishing CMF suggests that the amount of money pouring into Ethereum is reducing, which might lead to a price reduction. Furthermore, traders and investors may view this as a signal to consider taking gains or leaving positions ahead of a possible slump.

The stochastic RSI rating of 100 adds to the bearish momentum. A reading of 100 indicates that purchasing pressure may have peaked and a price reversal may be on the horizon, rendering Ethereum overbought.

ETH/USD 24-hour price chart (source: TradingView)

In conclusion, while Ethereum’s rally brings a wave of excitement, caution is warranted as technical indicators suggest a possible shift in momentum ahead.

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