Current trend

The ETH/USD pair continues to decline, trying to consolidate below the 2343.75 mark (Murrey level [7/8]) against the background of a market-wide correction after the approval of the bitcoin ETF by the US Securities and Exchange Commission (SEC).

Additional pressure on the prices of digital assets is exerted by the likelihood of a shift in the timing of the start of monetary policy easing by the world's leading regulators towards the end of the year due to increased inflation rates. Nevertheless, despite the current pullback in quotes, investors generally remain optimistic, believing that growth will resume in the medium term. This is indicated by two main trends: an increase in the number of long-term ETH holders, the percentage of which exceeds the same indicator for BTC, and the retention of a significant part of the coins in staking, despite the possibility of their withdrawal after the activation of the Shapella update.

Over the next few months, two key events will be able to support the token rate: the launch of the Dencun hard fork and the possible approval of spot ETFs based on Ethereum. The update, designed to increase the scalability of the network and reduce the cost of transactions within it, is currently being actively tested and should be launched on the main blockchain at the end of February. In turn, permission for the operation of exchange-traded funds can be obtained from the SEC in May after the deadline for reviewing the application from VanEck.

Support and resistance

The price of the ETH/USD pair fell below the level of 2343.75 (Murrey level [7/8]), which may lead to the development of a correction to 2187.50 (Murrey level [6/8], the lower line of Bollinger Bands), which is seen as key for the "bears" and has been tested more than once over the past month. If quotes are consolidated below it, the movement may continue towards the targets of 2000.00 (38.2% Fibonacci retracement) and 1875.00 (Murrey level [4/8]). After a reverse breakout of the central line of Bollinger Bands at 2425.00, growth is likely to resume to the level of 2700.00 (61.8% Fibonacci extension).

Generally, the uptrend in the market continues, as evidenced by the upward reversal of Bollinger Bands. The MACD is declining, but is held in a positive zone, and Stochastic is pointing downwards, but approaches the oversold zone, which doesn't exclude a reversal.

Support and resistance

Resistance levels: 2425.00, 2700.00, 2812.50.

Support levels: 2187.50, 2000.00, 1875.00

Trading tips

Long positions can be opened above the 2425.00 mark or when the price reverses around 2187.50 with the target at 2700.00 and stop-losses of 2300.00 and 2100.00, respectively. Implementation period: 5–7 days.