ETH Bulls to Target $1,850 on Shapella Upgrade Date and Staking Inflows

Key Insights:

• On Tuesday, ethereum (ETH) rallied 3.38% to end the day at $1,774.
• Shapella news and the broader crypto market delivered a recovery of losses from Monday.
• The technical indicators turned bullish, bringing $1,900 into view.

Ethereum (ETH) rallied by 3.39% on Tuesday. Reversing a 3.38% slide from Monday, ETH ended the day at $1,774. Despite the bullish session, ETH fell short of the $1,800 handle for the second consecutive session.

A mixed start to the day saw ETH fall to an early low of $1,702. Steering clear of the First Major Support Level (S1) at $1,675, ETH rallied to an early evening high of $1,796. ETH broke through the First Major Resistance Level (R1) at $1,769 to end the day at $1,774. Resistance at $1,800 capped the upside.

The CFTC Classifies ETH as a Commodity to Support a Bullish Tuesday

The Commodity Futures Trading Commission (CFTC) was back in the news on Tuesday. CFTC Chairman Rostin Behnam spoke at a congressional hearing on Tuesday, stating that ETH is a commodity and not a security. Behnam labeled several cryptos as commodities, including LTC and BTC, and stablecoins, including BUSD.

Benham has contrasting views to that of his SEC counterpart. Recently, Gary Gensler classified ETH as a security.

Investors and crypto market platforms may be confused about the CFTC’s decision to file a lawsuit against Binance. Before the filing, the markets considered the CFTC as a more pragmatic regulator that would support growth and innovation. However, the CFTC classification of BTC, ETH, and LTC as commodities could expose other exchanges to CFTC action.

While news of the CFTC lawsuit against Binance was market negative, the conflicting opinions of two crypto regulators about ETH could provide comfort and support a Ripple victory in the ongoing SEC v Ripple case.

Amidst intensifying regulatory activity, the Ethereum Foundation announced an April 12 Shapella upgrade date. According to the announcement,

“The Shapella network upgrade will activate on the Ethereum network at epoch 194048, scheduled for 22:27:35 UTC on April 12, 2023.”

The announcement went on to say,

“From now until April 5, the Ethereum Bug Bounty rewards have been doubled for Shapella vulnerabilities.”

Pre-Shapella ETH Staking Movements Bounce Back

ETH staking inflows bounced back on Tuesday after two consecutive days at sub-10,000 ETH levels, a bullish signal. According to CryptoQuant, staking inflows rose from 9,184 ETH on Monday to 24,768 ETH on Tuesday. A bullish Tuesday session and the CFTC classification of ETH as a commodity supported the rebound in staking.

The total value staked also bounced back on Tuesday, with the resumption of the upswing in total value staked another bullish signal.

The Day Ahead

Staking figures, Binance, and the SEC v Ripple case will remain focal points today. After the CFTC move against Binance and the classification of ETH as a commodity, SEC and CFTC chatter will also influence.

However, investors should also continue to monitor Coinbase (COIN)-related news.

This afternoon, the Federal Reserve will be in front of US lawmakers for a second day as lawmakers grill the Fed over the collapse of Silicon Valley Bank and Signature Bank. With banking sector jitters easing, talk of a credit crunch could test buyer appetite.

There are no US economic indicators to distract investors. However, Fed forward guidance on monetary policy could move the dial.

Ethereum (ETH) Price Action

At the time of writing, ETH was up 0.36% to $1,780. A range-bound start to the day saw ETH rise to an early high of $1,790 before easing back.

Technical Indicators

ETH needs to avoid the $1,757 pivot to target the First Major Resistance Level (R1) at $1,813. A return to $1,800 would signal a breakout session. However, the crypto news wires should be ETH-friendly to support a breakout.

In the event of an extended rally, the bulls would likely test the Second Major Resistance Level (R2) at $1,851 and resistance at $1,900. The Third Major Resistance Level (R3) sits at $1,945.

A fall through the pivot would bring the First Major Support Level (S1) at $1,719 into play. However, barring an event-fueled crypto market sell-off, ETH should avoid sub-$1,700 and the Second Major Support Level (S2) at $1,663. The Third Major Support Level (S3) sits at $1,569.

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 $1,753. The 50-day EMA pulled away from the 100-day EMA, with the 100-day EMA widening from the 200-day EMA, delivering bullish signals.

A hold above the 50-day EMA ($1,753) would support a breakout from R1 ($1,813) to target R2 ($1,851) and $1,900. However, a fall through the 50-day EMA ($1,753) would give the bears a run at the 100-day EMA ($1,726) and S1 ($1,719). A fall through the 50-day EMA would send a bearish signal.