Ethereum Price At A Tipping Point, Can The Surging Open Interest Fuel ETH Rally Past $3,000? – CoinGape
Published 2 days ago
Ethereum price steadied the uptrend, starting the New Year bullish with a breakout above $2,400. The leading smart contracts token extended the upper leg to $2,432, compelling investors to believe in the likelihood of a breakout to $3,000.
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However, caution is advised especially among traders who intend to enter new long positions and those contemplating either closing current open positions or hanging onto the bullish theory.
Crypto analyst Rekt Capital said via X that Ethereum “may have no choice” but to rally in tandem with Bitcoin, which broke above $45,000 on the first day of the New Year.
The analysts highlighted a breakout from a period of consolidation suggesting that it is only a matter of time before the tailwind behind ETH price intensifies resulting in a remarkable rally.
Not only is $ETH positioned for upside but it may have no other choice but to follow this recent #BTC breakout
#ETH #Crypto #Ethereum https://t.co/GTNCIu39NU pic.twitter.com/ga0u17oxG4
— Rekt Capital (@rektcapital) January 2, 2024
Meanwhile, Ethereum price is trading at $2,369 amidst a correction from the previous highs. The Relative Strength Index (RSI) reveals that sellers are gaining ground and fast. With a strength of 59 from highs close to the overbought region, the path with the least resistance could remain downwards.
If the short-term support at $2,360 holds, Ethereum price might cut short the forming downtrend while favoring the continuation of the uptrend to $3,000.
The 20 Exponential Moving Average (EMA) (in blue) and the 50-day EMA (in red) are in line to absorb the selling pressure if the decline intensifies over the coming sessions.
The same RSI is slightly bullish in longer timeframes like on the daily chart. Based on the trend strength indicator, those holding Ethereum do not need to worry about the lower time frames’ ups and downs but focus on the potential gains likely to follow the consolidation between $2,200 support and $2,400 resistance.
The 20-day EMA reinforces support at $2,280 while the 50-day EMA holds to provide support at $2,179. If Ethereum price overshoots the pivotal level at $2,000, the 200-day EMA (purple) would be in line to prevent losses from reaching the local support at $1,850.
An incoming buy signal from the Moving Average Convergence Divergence (MACD) indicator could help steady the bullish thesis. As traders and investors seek more exposure to ETH, the path with the least resistance is bound to remain upwards.
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The Ethereum futures open interest (OI) is growing steadily to hold above $7.5 billion on Tuesday, according to data provided by Coinglass.
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The persistent rise in OI interest signals that investors entertain a positive outlook for ETH. This backs the bullish narrative in the short term, with Ethereum likely to blast off above $3,000 before the end of January.
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