Yesterday
Bitcoin jumped following the news that Greyscale won the lawsuit against
the SEC as the D.C. court ruled that the SEC improperly rejected the Bitcoin
spot ETF. This was seen as a positive news as Greyscale will have to reapply
for a spot ETF but that an ETF is actually coming. This news has lifted all the
other cryptocurrencies, including Ethereum, as there’s a tight correlation with
Bitcoin. Looking at the bigger picture though, we have some bearish news all
around as CryptoQuant reported
that Bitcoin trading volume is at its lowest in more than four years and on the
macro side we have recessionary fears caused by weakening data as yesterday’s
Job Openings and Consumer Confidence missed expectations by a big margin
possibly pointing to a deterioration in the labour market. On top of that, the
central banks are expected to keep monetary conditions tight even if we start
to see more weakness creeping in, which should ultimately make the economic
conditions and the risk sentiment worse.

Ethereum Technical Analysis
– Daily Timeframe

On the daily chart, we can see that Ethereum after
a two-week long consolidation around the support level,
jumped following the news of Greyscale winning the lawsuit against the SEC. The
spike higher is getting rejected by the 61.8% Fibonacci retracement level
where we have also the confluence with the
red 21 moving average. This is
where the sellers are likely piling in with a defined risk above the level to
target another selloff into the lows.

Ethereum Technical Analysis
– 4 hour Timeframe

On the 4 hour chart, we can see that the spike
higher might have opened the door for more upside and we have a good support
zone around the 1681 level where we can also find the Fibonacci retracement
levels and the red 21 moving average. This is where we can expect the buyers to
step in with a defined risk below the black trendline looking
for another extension to the upside.

Ethereum Technical Analysis
– 1 hour Timeframe

On the 1 hour chart, we can see more
closely both the bearish and the bullish setups. If the price manages to break
below the black trendline, then the bullish setup would be invalidated, and we
will likely see much lower prices with the first support coming around the 1400
level. On the other hand, upside breaks should support the buyers going forward
and lead to higher highs.

Upcoming Events

This week is an important one given that we will see
many key labour market data for the US, including the NFP, before the next FOMC
meeting. Weak data is likely to cause recessionary fears across the markets and
weigh on Ethereum, while strong readings should keep the Fed on the hawkish
side and put a lid on the cryptocurrency’s upside. Today, we have the US ADP
report, and after yesterday’s big miss in the US Job Openings, a weak report is
likely to increase recessionary fears. Moving on to tomorrow, we will see the
US Jobless Claims and the US PCE data. Finally, we conclude the week with the
US NFP and the ISM Manufacturing PMI on Friday.

This article was written by FL Contributors at www.forexlive.com.