In the wake of Bitcoin which has just recovered almost 40% since the beginning of the year, Ethereum is sticking with it. Although the gains are somewhat smaller, main competitor BTC is almost $1,600, up more than 30% since January 1st. But then, what can we expect from the coming weeks?
Ethereum on the rise in 2023!
Like the market as a whole, the The beginning of the year is radiant for Ethereum. In 27 days, the second largest digital asset in the world has increased by more than 33% according to data provided by Coinmarketcap. If the performance is lower compared to Bitcoin (+ 39%), the Prince of cryptocurrencies as many call it, better than other major altcoins such as XRP, BNB or Litecoin.
But as the first month of the year draws to a close, the debates are between bulls and bears. Because since a few days, Ethereum has entered degree of laterality. Data from the technical analysis suggests a resistance level at the $1,515 threshold. For bulls, this is a price level that Ethereum must break down, otherwise it will weaken the beginning of the trend for the first 3 weeks of the year.
Reaching such a level could create a liquidation wave and push ETH to two lower levels near $1,430 and $1,330. But some believe the decline could be temporary and the asset could be squeezed quickly beyond the symbolic level of 2,000 dollars.
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Decrease to better bounce back to $2,000?
While many expect Bitcoin to quickly break the $30,000 threshold, for Ethereum it is the $2,000 threshold that attracts the lust bull. Many believe that the probability of seeing a second crypto above $ 2,000 is significant on the approach of a few weeks.
To justify this situation, proponents of this theory cite an upward movement in five waves. And we would be in the fourth wave right now with the price correction since the asset arrived to reach the $1,680 threshold. The current consolidation phase could be the starting point for the fifth wave and the final round.
Before they come in contact with the symbolic resistance level of 2000 dollars, they are very much considering that Ethereum will go back to 1500 dollars. Aspects of reading that we owe a lot to Fibonacci extensions. Therefore, extension 2.61 takes the sign in direction first target at $1,812. Meanwhile the next target would be near $2,097, as suggested by the 3.61 extension.
It is by this same logic of Fibonacci extensions that the point near $1,500 is advanced. It corresponds more precisely to $1,478, through the Fib support at 0.382. This technical analysis tool also suggests that a result below the $1,244 level could invalidate the bullish case. In such a case, the Ethereum token could fall below $1,200.
The FOMC as a justice of the peace?
For once, crypto news will end with a monetary policy decision. The next one Nutrition meeting scheduled for February 1 could act as a catalyst for Ethereum and the entire crypto market.
While the market is still anticipating further rate hikes, the latest announcements tend to loosen the grip. The IS fluctuation which could create the ad could then help the signal choose its path.
Source: FxStreet
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