Ethereum
Ethereum Assessment: Strong Technical Conflict with Regulatory Challenges
Looking at Ethereum (ETH-USD), It is obvious that strong technical signals face significant regulatory challenges. Ethereum recently regained the $3,000 level after falling below a bear flag and major trendline. It found support against the 100% Fibonacci extension at $2,848. If this level holds, it could create significant support despite recent pressures.
Bullish outlook on Ethereum
Ethereum’s resilience is also reflected in its relative strength index (RSI) metrics. According to Brown’s method, Ethereum’s daily RSI remains in a bull market condition, hovering between 40 and 50 since April 18.
Additionally, Ethereum’s moving averages over different time frames mostly suggest a buy signal. The 20-period exponential moving average (EMA) on the monthly time frame is $2,440, well below the current Ethereum price. Likewise, the 50-period EMA at $2,071 supports this positive outlook, as it is below the current price.
Bearish Considerations for Ethereum
On the other hand, significant downside risks threaten Ethereum. Figures such as Michael Saylor predict that the United States Securities and Exchange Commission (SEC) will classify Ethereum as a security, potentially rejecting all Ethereum ETF spot applications. If this were to occur, it could seriously limit acceptance from institutional and traditional investors, thereby limiting Ethereum’s growth prospects and market acceptance.
And even though Michael Saylor’s prediction is just an opinion, Saylor was right about Bitcoin (BTC-USD) and several successful crypto trends over the years. And he puts his money where his mouth is. However, it is important to remember that Ethereum is a competitor to Bitcoin and Bitcoin developers. Bitcoin developers are actively building projects on the BTC network that are traditionally the domain of Ethereum: DApps and DeFi. So for Sayler, it makes sense to want ETH to dive.
Additionally, Ethereum’s weekly EMAs are giving mixed signals. The 20-period EMA at $3,094.99 is slightly above the current ETH price, triggering a sell signal from the TipRanks Indicators Summary.
Investor confidence may be further dampened by the SEC’s advance rulings on major ETF applications, which are expected soon. The lack of in-depth discussions from SEC staff on Ethereum, relative to Bitcoin, could portend a less favorable outcome for Ethereum.
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