Ethereum (ETH), the second-largest cryptocurrency by market cap, has recently shown signs that a potential recovery is on the horizon.
Analysts were closely monitoring various technical indicators, and one of those analysts, Ali, did just that Highlight A major signal indicating an imminent price rise.
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Chain TD Signals Buy With Ethereum Eyes Restored
According to Ali's social media platform
TD Sequential is giving a buy signal on #Ethereum Daily chart! It is expected $ Ethereum We could see a recovery of one to four candlesticks. pic.twitter.com/Vg7FTl9X2a
– Ali (@ali_charts) May 15, 2024
This positive outlook is supported by Ethereum's recent performance, which has increased the asset by 2.3% over the past 24 hours.
However, Ethereum price is still below the critical level of $3,000. Despite the optimistic technical signals, external factors such as regulatory challenges could affect Ethereum's trajectory.
Specifically, a potential decline in Ethereum's spot ETF demand with the US Securities and Exchange Commission (SEC) is a concern, with analysts like Bloomberg's Eric Balchunas noting that the SEC's view of ETH as a security could significantly reduce Chances of ETF approval.
TLDR: The SEC asked commenters on Eth ETFs whether these applicants had properly submitted proposals to list the ETFs as commodities. This indicates that the SEC may be considering Eth as a security in its rejection. Our odds of agreeing remain the same: slim to none. Beautiful work from… https://t.co/g9HGPzGyOp
– Eric Balchunas (@EricBalchunas) May 14, 2024
Market sentiment and options trading trends
While the regulatory landscape presents challenges, market sentiment around Ethereum remains largely bullish. The options market, in particular, is showing a clear preference for calls rather than puts, suggesting that traders are betting on Ethereum prices rising.
Data from Deribit, one of the leading cryptocurrency options exchanges, reveals that the most popular strike price among these bullish bets is an ambitious $6,500.
This concentration of call options, especially those above $3,600, indicates that a large portion of the market expects Ethereum to reach higher levels by the end of June.
In contrast, according to a recent analysis by NBTC, Ethereum’s failure to break through the $2,925 resistance level could lead to another price decline. The initial support is near the $2880 level, followed by the major support at the $2860 area.
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If Ethereum price drops below $2,810, it will likely fall towards the $2,740 level, and further losses could push the price to $2,650 in the near term.
Featured image from Unsplash, chart from TradingView