Ethereum (ETH/USD) price joined bitcoin in its remarkable comeback on Thursday. It hit a high of $1,696, which was close to its highest level since September 2022. ETH has rallied more than 56% from the lowest point in 2022.
Ethereum and bitcoin prices surged due to an increase in liquidation by short-sellers. Data compiled by CoinGlass shows that BTC short liquidations exceeded $140 million on Wednesday. This compares to bull liquidations of less than $20 million.
The same is true with Ethereum, which saw short liquidations increase to $42 million. Most liquidations came from OKEx, followed by Binance and Huobi. Long’s liquidation only came in at $3.64 million. In most periods, Ethereum rises when short-sellers liquidate their trades.
Ethereum price also rose due to the possibility that Binance will settle with the Securities and Exchange Commission (SEC), a view shared by the company’s chief strategy officer who spoke with The Wall Street Journal (WSJ).
An agreement would be a good thing for both Binance and the crypto industry as it would end one of the biggest clouds hanging over the sector.
Meanwhile, risk-on stocks in the US have started performing well, indicating that retail traders are back. On Monday, QuantScape, Upstart, Roblox and Wish jumped more than 20% each.
Still, the biggest risk for Ethereum is monetary policy and regulations. Data published this week showed US inflation remained high in January while retail sales jumped. As such, these numbers could fuel a new wave of an aggressive Federal Reserve.
Ethereum Price Prediction
On the daily chart, we can see that the ETH/USD price has been in a consolidation phase over the past few weeks. During this time it remained in the range of $1,665 to $1,462. This was a remarkable range as it was the highest point in November last year. Now, it looks like Ethereum is attempting to move above this level of resistance.
Ethereum has moved above the 50-day moving average. Hence, there is a possibility of a bullish breakout in this stock. If it does, the next key level to watch would be $1,795 (Sept 12 high). A flip of this resistance to support could lead to a move to the key resistance at $2,027 (August 14 high).
However, a drop below the $1,468 support will invalidate the bullish view. This would indicate that there are more sellers in the market.
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