ETH Eyes $1,400 on Easing Fed Fear, as BTC Revisits $20,000

Key Insights:

• Bitcoin (BTC) and ethereum (ETH) shared a bullish start to the week, with ETH recovering from a bearish weekend to wrap up the session at $1,323.
• US economic indicators and Ethereum network updates delivered ETH a breakout session.
• However, the technical indicators for ETH remain bearish, supporting a return to 2022 lows.

On Monday, bitcoin (BTC) rose by 2.96%. Reversing a 1.29% loss from Sunday, BTC ended the day at $19,632.

A bearish start to the session saw BTC fall to an early low of $18,980. Steering clear of the First Major Support Level (S1) at $18,875, BTC rallied to a final hour high of $19,708.

BTC broke through the First Major Resistance Level (R1) at $19,328 and the Second Major Resistance Level (R2) at $19,588 to end the day at $19,632. Despite the bullish session, BTC came up short of $20,000 for a third consecutive session.

Ethereum (ETH) rallied by 3.60% on Monday. Reversing a 2.67% slide from Sunday, ETH ended the day at $1,323.

Tracking the broader market, ETH slid to an early low of $1,263. Steering clear of the First Major Support Level (S1) at $1,259, ETH rallied to a late afternoon high of $1,330. ETH broke through the First Major Resistance Level (R1) at $1,307 to end the day at $1,323.

Fed fear subsided on Monday, with US economic indicators delivering riskier assets with support. In September, the ISM Manufacturing PMI fell from 52.8 to 50.9. While the sector avoided a contraction, new orders and employment sub-components tumbled.

The Employment Index fell from 54.2 to 48.7, with the New Orders Index sliding from 51.3 to 47.1. The weaker numbers led the markets to ease bets of a 75-basis point Fed rate hike in November.

For ETH, market anticipation of the zkSync 2.0 mainnet launch also delivered support. zkSync took to Twitter on Monday, saying,

“25 Days to zkSync 2.0 on mainnet. The first production zkEVM zkRollup is getting closer, and we continue to be excited by the wave of projects joining the zkSync mission. Here are another five updates from our fast-growth ecosystem.”

For Ethereum, zkSync will tackle scalability and security.

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 1.87% to $19,999.

A bullish start to the day saw BTC rise from an early low of $19,502 to a late morning high of $20,157. BTC broke through the First Major Resistance Level (R1) at $19,900.

Technical Indicators

BTC needs to avoid the $19,440 pivot to break out from the First Major Resistance Level (R1) at $19,900 to retarget the Second Major Resistance Level (R2) at $20,168. Weak US JOLTs job openings would likely support a breakout US session. The Third Major Resistance Level (R3) sits at $20,896.

A fall through R1 and the pivot would bring the First Major Support Level (S1) at $19,172 into play. Barring an extended sell-off, BTC should avoid sub-$18,500. The Second Major Support Level (S2) at $18,712 will likely limit the downside.

The Third Major Support Level (S3) sits at $17,984.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bullish signal. This morning, bitcoin sat above the 200-day EMA, currently at $19,894.

The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish price signals.

Holding above the 200-day ($19,894) EMA and R1 ($19,900) would give the bulls a run at R2 ($20,168) and $20,500. However, a fall through the 200-day EMA ($19,894) would give the bears a run at the 100-day EMA ($19,587) and the 50-day EMA ($19,399).

Ethereum (ETH) Price Action

At the time of writing, ETH was up 2.14% to $1,352.

A bullish start to the day saw ETH rally from an early low of $1,263 to a high of $1,360. ETH broke through the First Major Resistance Level (R1) at $1,348.

Technical Indicators

ETH needs to avoid R1 ($1,348) and the $1,305 pivot to retarget the Second Major Resistance Level (R2) at $1,372 and test resistance at $1,400. US economic indicators and FOMC member chatter would need to be crypto-friendly to support a breakout US session.

The Third Major Resistance Level (R3) sits at $1,439.

A fall through R1 and the pivot would bring the First Major Support Level (S1) at $1,281 into play. Barring an extended US session sell-off, ETH should avoid sub-$1,250 and the Second Major Support Level (S2) at $1,238

The Third Major Support Level (S3) sits at $1,171.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. Ethereum sat at the 100-day EMA, currently at $1,362. The 50-day EMA narrowed to the 100-day EMA, while the 100-day EMA flattened on the 200-day EMA, delivering mixed signals.

An ETH breakout from R1 ($1,348) and the 100-day EMA ($1,362) would give the bulls a run at R2 ($1,372) and $1,400. However, a slide through the 50-day EMA ($1,328) would bring sub-$1,300 support levels into play.