ETH and a Return to $1,300 Rests in the Hands of the NASDAQ

Key Insights:

• On Tuesday, bitcoin (BTC) and ethereum (ETH) joined the broader crypto market in positive territory.
• After tracking the NASDAQ Composite Index into negative territory, a final-hour recovery reversed losses from the session.
• US economic indicators continue to question expectations of a December Fed pivot, testing investor sentiment.

Ethereum (ETH) rose by 0.95% on Tuesday. Partially reversing a 1.64% loss from Monday, ETH ended the day at $1,271. Despite the bullish session, ETH fell short of $1,300 for the third time in seven sessions.

After a mixed start to the day, ETH fell to an early evening low of $1,242. However, steering clear of the First Major Support Level (S1) at $1,235, ETH bounced back to strike a final hour high of $1,275. Coming up short of the First Major Resistance Level (R1) at $1,294, ETH eased back to end the day at $1,271.

On Tuesday, bitcoin (BTC) rose by 0.70%. Partially reversing a 0.89% loss from Monday, BTC ended the day at $17,094. The bullish session saw BTC end the day at $17,000 for the fourth time in seven sessions.

A mixed morning saw BTC rise to an early morning high of $17,109 before hitting reverse. Coming up short of the First Major Resistance Level (R1) at $17,312, BTC fell to a late morning low of $16,908. However, steering clear of the First Major Support Level (S1) at $16,762, BTC found late support to revisit the day high of $17,109 before easing back.

A Quiet Economic Calendar Left the NASDAQ to Guide Investors

Following last Friday’s jobs report and Monday’s ISM Non-Manufacturing PMI, uncertainty toward Fed monetary policy has resurfaced.

Elevated inflation, robust labor market conditions, including accelerating wage growth, and a pickup in service sector activity support the FOMC hawks and a delay to the anticipated Fed pivot.

US economic indicators had a muted impact on the dollar and the NASDAQ on Tuesday. However, rising bets of another hawkish Fed rate hike left the NASDAQ down 2.00% for the session.

In the final hour (UTC), the NASDAQ mini kicked off the session in positive territory, supporting the BTC and ETH reversal of earlier losses.

Today, US economic indicators could draw more interest, with unit labor costs and nonfarm productivity numbers in focus. Upward revisions to unit labor costs would further question the Fed pivot theory.

Barring a crypto event, we expect the NASDAQ Composite Index to continue guiding BTC and ETH. Regulator chatter and updates on FTX will need monitoring, however.

This morning, the NASDAQ mini was up 24.75 points, with the S&P 500 mini up 7.25 points.

Ethereum (ETH) Price Action

At the time of writing, ETH was down 0.87% to $1,260. A mixed morning saw ETH rise to an early high of $1,278 before falling to a low of $1,258.

Technical Indicators

ETH needs to move through the $1,263 pivot to target the First Major Resistance Level (R1) at $1,283. A return to $1,280 would signal a bullish afternoon session.

In the event of an extended rally, the bulls would likely take a run at the Second Major Resistance level (R2) at $1,296 and $1,300. The Third Major Resistance Level (R2) sits at $1,329

Failure to move through the pivot would leave the First Major Support Level (S1) at $1,250 in play. However, barring an extended crypto sell-off, ETH should avoid the Second Major Support Level (S2) at $1,230. The Third Major Support Level (S3) sits at $1,197.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bullish signal. Ethereum sat above the 50-day EMA, currently at $1,256. The 50-day EMA pulled away from the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A hold above the 50-day EMA ($1,256) would support a breakout from the 200-day EMA ($1,275) to bring R1 ($1,283) and R2 ($1,296) into play. However, a fall through the 50-day ($1,256) would bring S1 ($1,250) and the 100-day EMA ($1,250) into view.

Bitcoin (BTC) Price Action

At the time of writing, BTC was down 0.46% to $17,016. A mixed morning saw BTC rise to an early high of $17,156 before falling to a low of $16,997.

Technical Indicators

BTC needs to move through the $17,037 pivot to retarget the First Major Resistance Level (R1) at $17,166. A move through the morning high of $17,156 would signal a bullish session. However, the crypto news wires and the NASDAQ should be market-friendly to support a breakout session.

In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $17,238. The Third Major Resistance Level (R3) sits at $17,439.

Failure to move through the pivot would leave the First Major Support Level (S1) at $16,965 in play. Barring an extended sell-off, BTC should avoid sub-$16,750. The Second Major Support Level (S2) at $16,836 should limit the downside. The Third Major Support Level (S3) sits at $16,635.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. This morning, bitcoin sat above the 50-day EMA, currently at $16,934. The 50-day EMA crossed through the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A move through R1 ($17,166) would support a run at R2 ($17,238) to bring R3 ($17,439) into play. However, a fall through S1 ($16,965) would give the bears a run at the 50-day EMA ($16,934) and the 100-day EMA ($16,932). A fall through the 50-day EMA would signal an extended sell-off.