The largest smart contracts token, ETH, experienced a 0.4% decrease on Tuesday as it failed to maintain its position around $1,900. However, despite this pullback from a weekly high of $1,943, Ethereum price still holds an 8% gain in the past seven days. As Ethereum’s price wavers at $1,865, it faces two conflicting scenarios. If it reclaims resistance above $1,900, a pathway to $2,000 could be cleared. On the other hand, a loss of support at the 100-day Exponential Moving Average (EMA) might leave Ethereum vulnerable to declines targeting levels such as $1,730 and $1,600.
Since the Shapella upgrade in April, Ethereum staking has seen significant improvement, according to blockchain research platform Messari. Staking growth was slow and considered riskier before the network update enabled more accessible staking and unstaking of Ether. However, the market has changed for the better, and users now have the freedom to comfortably stake and unstake ETH, accelerating the rate of staking. May 2023 saw the highest monthly inflow recorded following the Shapella upgrade.
An increased staking rate indicates that investors prefer to hold onto Ethereum rather than keeping their tokens on exchanges where they can be more easily sold. Data from analytics platform Santiment mirrors this trend, showing that the largest non-exchange addresses’ level of supply has grown. In contrast, the supply from top non-exchange wallets has declined, with ETH supply on exchanges down to 9.2%.
Over the weekend, Ethereum’s price wobbled above $1,900, which led to a bearish pressure build-up on Monday. This, combined with the upper rising and dotted trendline’s resistance, forced Ethereum to test support given by the 50-day EMA at $1,823. The Relative Strength Index (RSI) confirms the increasing bearish grip, retreating within the neutral zone.
It is crucial to observe Ethereum’s reactions to the 50-day EMA’s support and the 100-day EMA’s buyer congestion. If Ethereum slips below these two critical levels, investors may need to prepare for an extended pullback. However, this is unlikely, considering the market structure improvements for Ether and the broader crypto market.
The Moving Average Convergence Divergence (MACD) maintains its bullish outlook, settling above the mean line (0.00). With the MACD line above the signal line, the path of least resistance is to the upside. If Ethereum manages to break the psychological barrier at $2,000, it could initiate the next recovery phase towards $3,000.
Source: Coingape
