Ethereum Price Forecast: Despite more ETF inflows and growing trader optimism, ETH falls
Despite US spot ETH exchange-traded funds (ETFs) approaching eight consecutive weeks of inflows totaling around $2 billion, Ethereum (ETH) fell 3% on Friday. The significant inflows come after the US’s stablecoin laws have advanced and public businesses have boosted their Ethereum treasury holdings.
Ethereum ETFs continue to attract investors as they wait for more price increases.
Positive developments surrounding the Ethereum ecosystem, such as the growth of tokenization through Robinhood’s initial offering of tokenized US equities on the Arbitrum Layer 2 (L2) network, are the source of their robust inflows.
Furthermore, more publicly traded businesses—like SharpLink Gaming (SBET), the biggest public holder of ETH—are adopting treasury strategies centered on Ethereum. Additionally, BitMine has changed its strategy from mining Bitcoin to focusing on an Ethereum Treasury path.
As the House of Representatives prepares to discuss the GENIUS stablecoin bill and the crypto market structure bill during the forthcoming Crypto Week, which is scheduled for the week of July 14, these developments coincide with advancements in US crypto legislation.
Because the Ethereum blockchain powers almost half of the stablecoin market, traders on the cryptocurrency options exchange Derive have a generally bullish attitude toward the leading altcoin.
“About 80% of open interest in ETH calls for the July expiration is focused above $3K. Surprisingly, about 30% of strikes over $3.5K. “Clearly, the market is anticipating a breakout,” noted Sean Dawson, Derive’s Head of Research.
Even with the bullish outlook, the market’s potential direction for the month will be influenced by the Federal Reserve’s July meeting, geopolitical events, and the House’s decision on the CLARITY and GENIUS bills.
Ethereum Price Forecast: ETH sees rejection at key SMAs, risks 35% decline if death cross plays out
According to Coinglass statistics, Ethereum saw $56.82 million in futures liquidations over the course of the last day, consisting of $47.02 million in long liquidations and $9.80 million in short liquidations.
ETH’s Simple Moving Averages (SMAs) are indicating a negative signal on the weekly chart after thwarting an upward advance near $2,600 during two months of consolidation, during which it has traded between $2,100 and $2,850. A possible death cross is indicated by the 50-period SMA about to cross below the 100-period SMA. This suggests that the long-term momentum is stronger than the short-term momentum.
The past two times such a crossover occurred, ETH pulled a gain/loss of more over 35%. Therefore, if history is repeated, a validation of the death cross might cause ETH to plummet to $1,750.
The Stochastic Oscillator (Stoch) made a similar rise near the line of its overbought zone, while the Relative Strength Index (RSI) resumed a horizontal trend close to its neutral level. This suggests a little optimistic undertone despite the market’s generally neutral velocity.
The argument might be refuted by a strong breakout above the upper bound of a symmetrical triangle pattern.
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