The central theses
- Ethereum’s price chart shows a potential negative warning in a death cross.
- The market can expect volatility due to the current expiration of options and the increasing volume of derivatives.
- Many investors are waiting for the upcoming London hard fork of Ethereum, which includes the crucial fee-burning proposal of EIP-1559.
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The Ethereum price chart etches a warning sign into a death cross between the 50- and 200-day moving averages. Nonetheless, ETH has been backed by the support with the help of bitcoin’s bullish momentum and the upcoming supply-reducing EIP-1559 update.
Ethereum continues push
Although Ethereum shows a death cross, the outlook for the second crypto seems optimistic.
Ethereum could be ready for an uptrend before its big EIP-1559 upgrade ships next week, but technically ETH faces many hurdles on its way to $ 3,000.
The ETH / USD chart is currently flashing a red signal in a death cross between the 50- and 200-day moving averages. The larger of the two moving averages, hovering above the smaller one (in this case the 50-day moving average), suggests weakness in the uptrend.
Support at the intersection of the two moving averages at $ 2,100 is critical for Ethereum. The upside resistance is at $ 2,650.
Source: TradingView
The ETH / BTC chart is trying to break away from the multi-year support and resistance line between the ratios of 0.058 and 0.063. A weekly closing price on either side of this band would further reinforce the buy or sell.
Source: TradingView
According to data from Glassnode, wallets with more than 1,000 ETH worth $ 2.4 million have made gains in the past two days. The total number of addresses with more than 1,000 ETH has dropped from 6,377 to 6,538, which corresponds to 19 sales of whale wallets.
Nonetheless, Ethereum traders appear to be drawn to the recent surge in volatility as they look for short-term gains around the EIP-1559 launch over the next week. The charge incineration proposal, in which part of the ETH is burned with every transaction, is being delivered as part of the London hard fork in block 12,965,000, which is expected to land around August 4th.
The volume of open interest for Ethereum futures climbed to $ 5.99 billion yesterday, its highest level in a month.
In addition, today is the last trading day before the monthly options contracts expire. The volume of open interest for Ethereum options contracts reached a monthly high of $ 2.95 billion. More than $ 21 billion in options contracts expire tomorrow, with nearly $ 15 billion in call (or buy) options. The maximum pain price for tomorrow’s ETH options expiration is USD 2,350.
Meanwhile, Bitcoin’s consolidation of around $ 40,000 is starting to build up momentum but is facing strong resistance at $ 42,000. A negative reaction from the top cryptocurrency can affect the price of ETH. Delta Exchange CEO Pankaj Balani wrote in an email to Crypto Briefing.
“For tomorrow in July, the activity was in the strike calls of $ 40,000 to $ 44,000. US $ 42,000 is the best-selling strike here and should serve as the upper limit for this process. “
The fundamental and technical indicators are currently giving a mixed signal for Ethereum. While the momentum is up, traders need to be wary of the support levels on Bitcoin around $ 36,000 and ETH between $ 2,100 and $ 2,150.
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