The cryptocurrency market and Ethereum continue to move within a narrow range of fluctuations. The main altcoin attempts to leave the area of movement, but rests on a strong area of resistance and fundamental factors.
The main altcoin remains dependent on Bitcoin, and, accordingly, on the state of stock indices and Fed policy. Given that the state of the main cryptocurrency leaves much to be desired, Ethereum is moving within a narrow range. Any bullish attempt to exit the corridor ends in failure due to BTC pressure.
Markets expect the key rate to rise to 4.5% by early 2023. This means that in the medium term, the growth of Ethereum will be possible with a correction in the US dollar index and a parallel bullish trend in Bitcoin. In the short term, the probability of going beyond the current range of $1,200–$1,400 is unlikely.
Ethereum on-chain activity
Ethereum network indicators show bullish signals, which is usually a harbinger of an upward movement. Santiment notes a sharp increase in the number of unique addresses in the altcoin network. This may indicate a growing interest in ETH and a likely increase in trading volumes.
However, after peaking in mid-September, Ethereum trading volumes continue to fall. This is a negative signal indicating low purchasing power and lack of interest in the asset. Also, low volumes indicate a divergence between trading volumes and the number of unique addresses.
This means that an increase in the number of addresses does not provoke an increase in trading activity and, as a result, does not entail an increase in the price. The trading volume metric will likely start to catch up with the growing number of addresses on the ETH network. However, as of October 11, the surge in new addresses does not lead to an increase in trading activity and an increase in ETH/USD quotes.
The Net Realized Profit/Loss on-chain metric also indicates low trading activity and a lull in most addresses. On the one hand, this confirms the fact that the growth in the number of unique addresses did not drastically affect the state of ETH. On the other hand, NRPL says that most of the investors have shifted to long-term ownership.
ETH/USD technical analysis
As of October 11, Ethereum is trading near the $1,300 level. The asset has fallen in price by 5% over the past seven days and continues to move in a narrow range of $1,200–$1,400. As we have already understood, the current volumes of the altcoin will not be enough to independently exit the price fluctuation corridor.
Technical metrics confirm the absence of prerequisites for the emergence of impulses. The RSI and the stochastic oscillator are moving flat with no signals for a bullish momentum. The MACD indicator is also moving flat below zero, which indicates that there are no prerequisites for growth in the medium term.
ETH/USD will likely continue to fluctuate within the specified range. There are no obvious prerequisites for the formation of an important figure in technical analysis. The coin is still unable to break through the downward trend line, and therefore, when planning active trading actions in relation to ETH, it is important to look first of all at BTC, SPX, and DXY.
Moreover, the presence of certain signals on the charts of other financial instruments does not guarantee price movement. In the current stage of the market, trading volumes play a decisive role when trying to leave a range or realize a bullish momentum. Given the minimum volumes of ETH with a growing number of addresses, there is no reason to expect a significant increase (out of range) this week.
Relevance up to 10:00 2022-10-12 UTC+2 Company does not offer investment advice and the analysis performed does not guarantee results. The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.