Crypto markets seemingly revive – but Ethereum is still too weak
Crypto prices are bouncing back after two rough days. Bitcoin climbed over 5%, hitting $68,151, and Ethereum rose 3% to $3,270 at press time.
This comes as investors move back into riskier assets. Stocks like the Nasdaq Composite and S&P 500, which had their worst day since 2022 earlier this week, also saw gains. Coinbase jumped 4%, and MicroStrategy leaped 9%.
Bitcoin got a boost when the Federal Reserve’s favorite inflation gauge, the personal consumption expenditures price index, showed prices had eased a bit in June compared to a year ago.
This news makes a September interest rate cut seem likely. Investors are also eyeing the Bitcoin Conference in Nashville, where former President Donald Trump is set to speak.
He’s recently branded himself as a pro-crypto candidate, and many expect his comments could drive prices higher.
Ethereum’s struggles continue
Despite the overall market recovery, Ethereum is still facing problems. The drop in tech stocks this week, due to disappointing earnings from Alphabet and Tesla, made investors pull out of crypto.
The market is also feeling the impact of the ongoing Mt. Gox repayment schedule, and at the same time, the new Grayscale Ethereum Trust (ETHE) is seeing massive outflows.
Crypto trader Mags says the altcoin market is in the “reaccumulation stage.” This comes after reclaiming a key support area, which could lead to the “second leg of the cycle.” Mags added that:
“Do you really think a breakout after 525 days of consolidation will end after just a 58% move? This pullback is probably just re-accumulation before another leg up.”
The accumulation stage happens when the market bottoms out and prices hit local lows. This is shown by a 33% drop in TOTAL2 (the total market capitalization of all cryptocurrencies, excluding Bitcoin) since March 11.
During this stage, investors buy during dips, expecting prices to rise in the future. Mags shared the chart above showing that, despite the correction, altcoins are up 58% since breaking out of a long accumulation period.
Ethereum’s technical indicators aren’t looking good either. It has fallen below its moving averages, and the bears are struggling to form a lower high at $3,563.
The RSI is just below the midpoint. This gives a slight edge to the bears. If the current recovery fails at the moving averages, Ethereum could drop to $3,000.
Orrrrrrrrr, if buyers manage to push the price above the moving averages, it will show that buyers are still interested in lower levels. Ether might then climb to $3,563 and possibly reach the downtrend line.
