Coin Edition -
- If ETH holds above $2,130, it may rally if the SEC approves the Bitcoin ETF.
- The resistance at $2,290 ensured that ETH’s price decreased to $2,226.
- Open Interest decreased but may drive ETH to the key resistance at $2,290.
Crypto Tony, an investor in the market, told his 386,800 followers on X that Ethereum’s (ETH) ability to hold $2,130 would help it continue its rally. However, Tony also mentioned that the rally would only resume if the U.S. SEC approves the Bitcoin (BTC) ETFs.
$ETH / $USD – Update $2,130 hold this weekend for the rally to continue. This is all dependant on the ETF verdict for #Bitcoin pic.twitter.com/R7bYqgOTdj— Crypto Tony (@CryptoTony__) January 5, 2024
On January 2, the price of ETH jumped to $2,429, marking a 10% increase within 24 hours. But a day later, the price collapsed below $2,200. Coin Edition reported at that time how the FUD arose as a result of the speculation that the SEC would reject the Bitcoin ETFs.
However, recent events have shown that approval might be on the way. Also, market prices including that of ETH have stabilized.
The Altcoin’s Strength Has Waned
At press time, ETH, despite losing 1.84% of its value in the last 24 hours, changed hands at $2,226. Details from the 4-hour chart showed that resistance at $2,290 was responsible for the drawdown.
It was also evident from the Relative Strength Index (RSI) that Ether’s attempt at an upward movement has been met with weakness. The RSI, as of this writing, was 41.12, indicating how ETH no longer had the bullish momentum it enjoyed on January 2.
However, if bulls can defend the coin from dropping below $2,200 again, then ETH might join BTC’s potential rally in the coming week. Signs from the Money Flow Index (MFI) revealed that some market players shared the same sentiment.
ETH/USD 4-Hour Chart (Source: TradingView)
ETH to Eye $2,500
For instance, the MFI as of January 4, was 29.29. Furthermore, the indicator growth to 56.60 suggests that market participants identified a buying opportunity when ETH’s price corrected.
Should the MFI reading continue to increase, the price of the altcoin might hold above $2,200. Going forward, this could open doors for a jump toward the $2,500 direction.
In addition, Coin Edition considered the Open Interest in the cryptocurrency. According to Coinglass, ETH’s Open Interest was $7.04 billion as of this writing.
This value was a decrease from what the Open Interest was on January 5. It also means that many market participants are closing their net positions in the derivatives market.
ETH Open Interest (Source: Coinglass)
From a trading point of view, the Open Interest might either dump into the support or pump into the resistance. If ETH holds above $2,130 this weekend, then the price action might pump into the $2,290 resistance.
Should this happen alongside the ETF approval, the coin’s move to $2,500 could be validated. If not, ETH might struggle to follow Bitcoin’s direction.
The post Analyst Says ETH’s Potential Rally Rests on Bitcoin, Here’s Why appeared first on Coin Edition.