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TA: Ethereum Nears Breakout Zone, Why ETH Might Start Recovery

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TA: Ethereum Nears Breakout Zone, Why ETH Might Start Recovery

Ethereum started an upside correction from $2,200 against the US Dollar. ETH might gain bullish momentum if it clears the $2,400 resistance zone.

  • Ethereum started an upside correction above $2,300 and $2,320.
  • The price is still trading below $2,400 and the 100 hourly simple moving average.
  • There is a key bearish trend line forming with resistance near $2,385 on the hourly chart of ETH/USD (data feed via Kraken).
  • The pair could start a steady recovery wave if there is a close above $2,400 and $2,450.

Ethereum Price Faces Breakout Resistance

Ethereum extended its decline below the $2,400 level. ETH even traded below the $2,300 before the bulls appeared near the $2,200 support zone.

The price started a recovery wave above the $2,300 and $2,320 levels. The bulls pumped the price above $2,400, but they failed near $2,450. Recently, there was a fresh decline to $2,250. A low is formed near $2,263 and the price is now rising.

There was a break above the $2,320 level. Ether price is trading above the 50% Fib retracement level of the recent decline from the $2,455 swing high to $2,263 low.

However, it is still trading below $2,400 and the 100 hourly simple moving average. On the upside, an initial resistance is seen near the $2,385 level. There is also a key bearish trend line forming with resistance near $2,385 on the hourly chart of ETH/USD.

Source: ETHUSD on TradingView.com

The first major resistance is near the $2,400 level. The main resistance is now forming near the $2,455 level. A close above the $2,455 level could open the doors for a decent increase. In the stated case, ether price might rise towards the $2,550 resistance.

More Losses in ETH?

If ethereum fails to recover above the $2,455 resistance, it could continue to move down. An initial support on the downside is near the $2,300 zone.

The next major support is near the $2,260 level. The main breakdown support now sits near the $2,225 level. If there is a downside break below $2,225 and the $2,200 zone, ether price extend losses. In the stated case, it might even visit the $2,000 support.

Technical Indicators

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Hourly MACDThe MACD for ETH/USD is slowly moving in the bullish zone.

Hourly RSIThe RSI for ETH/USD is just above the 50 level.

Major Support Level – $2,260

Major Resistance Level – $2,455

Bitcoin

Exchange Inflows Rock Bitcoin, Ethereum As Market Struggles To Recover

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Exchange Inflows Rock Bitcoin, Ethereum As Market Struggles To Recover

With the market in turmoil, digital assets such as Bitcoin and Ethereum are seeing their prices challenged in ways that have sent shivers down the spines of investors. The downtrend had triggered massive sell-offs that had sent prices towards yearly lows. Despite the volume already being sold off, sellers look to not be done yet. This is evidenced by the volume of Bitcoin and Ethereum that has been making its way to centralized exchanges recently.

Bitcoin, Ethereum Rocked By Inflows

The inflows had been growing steadily recently and given the volume that has been going into exchanges, this growth is alarming. Top coins Bitcoin and Ethereum usually hold up best when it comes to markets like this, and though they have held up, investors seem unconvinced that they would continue to do so. This is one of the reasons why the inflows have been massive.

Data shows that more than $1.4 billion worth of Bitcoin has flowed into centralized exchanges in the last 24 hours alone. Although this is a decline from the previous day when $1.7 billion in BTC had been moved into exchanges, it significantly surpassed the outflow rate compared to the previous day.

Related Reading | How The Tether Peg Could Predict Raging Bitcoin Volatility

Outflows for bitcoin for the last 24 hours came out to $1.2 billion. What this led to was a positive net flow of $233 million. 

Ethereum was not left out of this either. If anything, the second-largest cryptocurrency by market cap has been worse hit by exchange inflows. For the previous day, its inflows had touched $569 million. But unlike Bitcoin, it did not record enough outflows to offset this figure.

BTC continues downtrend | Source: BTCUSD on TradingView.com

This would continue into the Wednesday market which saw $658.2 million flowing into centralized exchanges. In the same time period, there was $651.1 million flowing out of the exchanges, which left a positive network of $7.2 million.

USDT Outflows Spell Selling

One way to indicate if investors are selling or buying Bitcoin, Ethereum, and other digital assets is through the stablecoin inflow, and lately, this flow rate has been anything but encouraging. Tuesday saw $1.1 billion USDT flowing into exchanges, marking a significant figure but the outflows came out higher. In total, there was $1.7 billion in USDT leaving exchanges, resulting in a negative $612.1 million net flow.

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Related Reading | Funding Rates Fall To Yearly Lows Following Bitcoin’s Fall Below $29,000

What metrics like this show is that investors are likely turning their volatile cryptocurrencies into these stablecoins and moving them out of the exchanges for safekeeping. Mostly to provide shelter from a highly volatile market.

Nevertheless, the USDT volumes from the last 24 hours are beginning to paint a slightly better picture. While outflows had reached as high as $738.5 million for the past day, inflows were $871.4 million, a positive net flow of $132.9 million. If this trend continues, then the current selling trend could well be turned around into a buyer’s that would hopefully trigger a recovery in the market. 

📊 Daily On-Chain Exchange Flow#Bitcoin $BTC

➡️ $1.4B in

⬅️ $1.2B out

📈 Net flow: +$223.0M#Ethereum $ETH

➡️ $658.2M in

⬅️ $651.1M out

📈 Net flow: +$7.2M#Tether (ERC20) $USDT

➡️ $871.4M in

⬅️ $738.5M out

📈 Net flow: +$132.9Mhttps://t.co/dk2HbGwhVw

— glassnode alerts (@glassnodealerts) May 19, 2022

Featured image from News Central TV, chart from TradingView.com

Follow Best Owie on Twitter for market insights, updates, and the occasional funny tweet… 

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ETH

Ethereum Prepares For Ropsten Testnet Merge As Token Struggles To Hold $2k Support

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Ethereum Prepares For Ropsten Testnet Merge As Token Struggles To Hold $2k Support

The Ethereum 2.0 update is generating a lot of buzz and interest, and we’re getting closer to its launch than ever before.

Ethereum 2.0 Goes To Testnet

Testing for Ethereum’s long-awaited Merge is progressing, though not at the rate that many had hoped. Testing on Ropsten, Ethereum’s largest and primary testnet, which has the closest similarity to the mainnet, is the next key milestone in the Merge testing process.

Ropsten testing will be merged on June 8, according to Ethereum client developers. Although there is no official indication on when the Merge will take place on mainnet, it is expected to happen in the second part of this year.

On Monday, Ethereum DevOps developer Parathi Jayanathi submitted a pull request for the Ropsten testnet Merge configuration code, indicating that it is ready for implementation.

The Merge is Ethereum’s long-awaited upgrade, in which the current Ethereum Mainnet and the beacon chain PoS system will merge.

Because it has a comparable network structure to the Ethereum Mainnet, this testnet is considered the best replication. Developers may now perform realistic deployment testing before making changes to the mainnet.

The Ropsten testnet Merge will combine the proof-of-work (PoW) network with a new proof-of-stake (PoS) consensus layer testnet, with a May 30 launch date. It will simulate what will happen when Ethereum and the Beacon Chain merge and the network becomes a PoS network.

Related Reading | New Data Shows China Still Controls 21% Of The Global Bitcoin Mining Hashrate

Testing how the merge would work on Ethereum’s main public testnet would be one of the final assessments. As a result, the Ropsten public testnet is regarded as the most accurate clone of the Ethereum Mainnet, as it uses a similar network structure and allows developers to test their work in a live environment.

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Online, community developers have expressed their enthusiasm for the testnet announcement. According to Preston Van Loon, an Ethereum core engineer at Prysmatic Labs:

Ropsten testnet is getting merged on June 8!

Merging Ropsten is a huge testing milestone towards Ethereum’s mainnet merge later this year. 🎉 https://t.co/X7eLIMA72g

— prestonvanloon.eth @ Permissionless (@preston_vanloon) May 18, 2022

Price Fails To Hold $2K

ETH is dropping inside a falling wedge on a daily time frame (in yellow). It’s worth noting that the wedge bottom is lined with the $1700 horizontal support level (in green), which could signal a trend reversal.

As a result, if the bulls can hold the green zone, the price will be more likely to rise towards the $2450 level of static resistance. The price is more likely to begin a protracted regression phase if the bears continue to suppress the market and breach below the green support zone.

ETH is trading on dynamic support (in green) against Bitcoin, which has blocked additional price decreases four times in the past.

The world’s second-largest cryptocurrency, down 4.1 percent in the last 24 hours to US$1,974, has lost 48% of its value since 2022.

ETH/USD trades below $2k. Source: TradingView

And crypto investors who bought on November 16, 2017, when the Ethereum price was at an all-time high of US$4,892, will have lost just over 60% of their investment.

Ethereum’s market cap has decreased to US$236 billion from well over half a trillion dollars at its height, despite maintaining its number two position.

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Related Reading | Bitcoin Indicator Hits Historical Low Not Seen Since 2015

Featured image from iStockPhoto, Charts from TradingView.com

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16 cross-chain bridges

Terra Collapse Continues To Plague Defi — Value Locked In Cross-Chain Bridges Down 20% This Month

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Terra Collapse Continues To Plague Defi — Value Locked In Cross-Chain Bridges Down 20% This Month

Following the aftermath of the Terra blockchain fiasco, decentralized finance (defi) continues to feel the impact of the project’s fallout. During the last four days the total value locked (TVL) in defi has dropped 2.61% in value, and cross-chain bridges have lost roughly 20.3% during the last 30 days.

Value Locked in Cross Chain Bridge Tech Slips 20% Lower Than Last Month

Over $100 billion in USD value was recently removed from the total value locked (TVL) in defi and TVL statistics continue to slide. Four days ago, the TVL in defi was approximately $112.29 billion and today, the TVL is down 2.61% to $109.35 billion. In addition to the TVL in defi across a dozen blockchains, cross-chain bridge TVLs have slipped a great deal during the past month.

30-day metrics from Dune Analytics indicates that the TVL across cross-chain bridges is down 20.3%. Today, there’s $16.49 billion total value locked across 16 different cross-chain bridges. In addition to the cross-chain bridge TVL the number of ethereum bridge unique daily depositors has also dropped.

As of Thursday, May 19, 2022, Polygon has the largest TVL among the 16 cross-chain bridges monitored on Dune Analytics. Polygon has $5.15 billion today. The $5.15 billion on Polygon bridges represents 31.23% of the entire $16.49 billion cross-chain bridge TVL.

Polygon is followed by Avalanche ($3.55B), Arbitrum ($3.2B), Fantom’s Anyswap ($1.87B), Near Rainbow ($1.86B), Optimism ($585M), Harmony ($229M), Moonriver ($154M), and Xdai ($122M).

The top crypto asset leveraged on cross-chain bridges today is the stablecoin usd coin (USDC). The stablecoin has $5.1 billion locked and is followed by WETH or ETH with $4.57 billion locked. Tether (USDT) is the third-largest with $1.9 billion today and other notable cryptos leveraged on cross-chain bridges include WBTC, DAI, and MATIC.

The losses across defi stem from two different factors. One, the Terra blockchain fallout removed more than $40 billion from the defi ecosystem in a very short period of time. The remaining billions have left defi in various ways including using cross-chain bridges because defi users have been rattled by the Terra catastrophe.

Billionaire investor and crypto proponent Mike Novogratz published a blog post yesterday covering the recent Terra blockchain fiasco and he said “the collapse dented confidence in crypto and defi.”

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16 cross-chain bridges, Arbitrum Bridges, Avalanche Bridge, axie infinity, Blockchain, Bridge, Bridges, Cross-chain, DeFi, Defi TVL, ETH, Fantom, Fantom Anyswap Bridge, Harmony Bridges, Multi-Chain, multi-chain ecosystem, Optimism ERC20 Bridges, Polygon ERC20 Bridge, ronin, Solana, Terra Blockchain, Terra fallout, USDC

What do you think about the dent in confidence to the defi ecosystem and the value locked in cross-chain bridge tech dropping lower than last month? Let us know what you think about this subject in the comments section below.

Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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