Ethereum Aims for Recovery Amid Growing Network Activity and Anticipated ETF Approval
Summary:
Ether (ETH) is aiming to recover from its recent market downturn, spurred by growing network activity and the potential approval of a spot Ethereum ETF. Significant increases in Ethereum's network activity, boasting 101,000 new daily ETH addresses, indicate a broadening user base. Surging interest in a spot Ethereum ETF, post the approval of Bitcoin ETFs by the SEC, has fueled optimism in the crypto market. From a technical standpoint, Ether is nesting on a robust support zone, with potential for bullish sentiment pushing prices towards $2,500.
Ether (ETH) has seen an impressive rise this year, reaching its highest point over $2,700. However, following the approval of the Bitcoin spot ETF, Ether saw some downturn alongside the rest of the market. This week, Ether aims to reignite its momentum, underpinned by growing network activity.
Ether appears to be on the rise due to substantial increases in network activity. As the biggest layer 1 blockchain measured by total value locked, Ethereum is seeing a noticeable surge in network activity. Santiment, a market intelligence entity, notes that daily new ETH addresses hit 101,000, with 484,000 unique addresses interacting with the Ethereum network. Being up almost 30% compared to three months ago, it implies more users are busy with transactions, developing smart contracts and crafting decentralized applications (DApps).
Enthusiasm for a possible Ethereum spot ETF is also contributing to a positive outlook. The U.S. Securities and Exchange Commission (SEC) approved 11 Bitcoin spot ETFs on January 10, sparking speculation that Ethereum may be next.
Traders theorize that a spot ETH ETF approval could lead to a noteworthy surge in Ether’s price both before and after this projected date of May 23. Standard Chartered Bank suggests ETH prices could either mirror or surpass Bitcoin during this period. Despite positive sentiment following Bitcoin ETF's approval, the cryptocurrency still closed below its peak. Now, eyes are on Ether, with Standard Chartered analysts predicting Ethereum could outperform Bitcoin when the Spot ETH ETF is confirmed on May 23.
Ether's current technical standpoint indicates it is sitting comfortably on a robust support zone, with challenges it faces in its recovery path. Support around $2,250 lies within the $2,230 to $2,297 price range, where approximately 3.38 million ETH were formerly bought by roughly 2.95 million addresses. This range has seen consistent activity since Dec. 5, 2023, marking it as vital territory for both buyers and sellers. If bullish sentiment sustains, pushing the price above the 50-day exponential moving average at $2,306, the next key level could be $2,500.
In contrast, bearish sentiment could pull the price lower, with the 100-day EMA at $2,190 acting as the first significant support. Further defense could be encountered from the 200-day EMA at $2,039 and the $2,000 demand level.
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Published At
2/1/2024 9:26:19 PM
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