ETH Price Bulls Ready To Defend $1,600 Support

ETH Price Bulls Ready To Defend $1,600 Support

Ethereum price has steadied its bullish outlook this week despite worrying sentiments over a large transfer of the leading smart contracts token to a major exchange. After bagging 3% in gains over the last week, ETH trades at $1,634 on Wednesday.

The crypto market, which has surprisingly sustained a positive outlook, with Bitcoin soaring by 5% to trade at $27,156, is awaiting for the decision on the September monetary policy from the Federal Open Market Committee (FOMC) meeting.

Ethereum and Bitcoin have covered considerable upside ground since the release of the United States Consumer Price Index (CPI) a week ago, which revealed that inflation was still an issue.

An interest rate hike is the most likely option as the Federal Reserve seeks to curb the skyrocketing inflation mainly caused by a persistent increase in global crude oil prices.

On the other hand, the crypto market has over the last few months shown commendable resilience against interest rate hikes. Hence, investors are likely to keep a positive outlook regardless of the outcome of the FOMC meeting.

The Odds Of Ethereum Price Rallying To $3,325

Ethereum price bulls face one crucial stumbling block between $1,650 and$1,700. A successful break and hold would confirm the breakout to $1,800 and subsequently trigger a buying spree due to an enhanced market structure for gains past $2,000.

According to the weekly chart, ETH now sits on top of one of the bullish market indicators; the 200-weekly Exponential Moving Average (EMA) (purple) at $1,626. Every time Ethereum price breaks above this level, a rally ensues before profit-booking activities dampen the uptrend.

Ethereum price chart
ETH/USD weekly chart | Tradingview

Traders must, however, realize that the 200-weekly EMA is not enough to launch Ethereum price into the anticipated rally. Therefore, it must be a collective effort among the bulls to defend the support at $1,600 and push for the repossession of the 21-weekly EMA (red) and the 100-weekly EMA (blue).

With all three moving averages serving as support, bulls will have a chance to push for a larger breakout above a forming ascending triangle pattern.

A breakout from this pattern would occur after ETH price pushes above resistance at $2,100. It would be accompanied by a spike in volume, calling for buy orders placed above the resistance.

The breakout target, 58% to $3,325 is the distance equivalent to the height of the triangle extrapolated above the breakout point.

Some traders may want to confirm the rally with a buy signal from the Moving Average Convergence Divergence (MACD) indicator. Such a call manifests with the blue MACD line crossing above the red signal line and the momentum indicator generally slopes upward.

Large Holders Send ETH To Exchanges

On-chain transaction trackers have revealed a trend where whales aka large holders are sending large amounts of ETH to exchanges. Ethereum worth roughly $60 million has made it from rather dormant wallets to exchange platforms amid fears of the impact the transfers may have on the price.

Ethereum co-founder Vitalik Buterin is reported to have transferred 300 ETH worth approximately $492,000 to the Kraken exchange on Tuesday. Although this single transaction might not impact ETH price, it has spurred discussions among enthusiasts, considering Buterin’s position in the community.

Another notable transfer worth around $50 million was deposited to several exchanges including OKX, Binance, and KuCoin over the last five days, according to the blockchain data tracker Lookonchain.

That’s not all, there was another transaction worth $10 million to Kraken by a crypto wallet that participated in the protocol’s ICO 9 years ago.

Transfers to exchanges often mean that investors are getting ready to sell, which explains the spike in speculation over the recent whale transfers.

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John is a renowned crypto analyst and journalist, providing expert insights into both broad and focused aspects of the digital asset market. As a steadfast reporter, he keeps his audience updated with the latest news in the crypto sphere, delving into topics such as price trends, on-chain data analytics, Non-Fungible Tokens (NFTs), Decentralized Finance (DeFi), Centralized Finance (CeFi), and the ever-evolving metaverse.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.


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