ETH Eyes a Return to $1,650 to Bring $1,700 into Play on Network News

Key Insights:

• It was a mixed Saturday for bitcoin (BTC) and ethereum (ETH), with the BTC extending its winning streak to three sessions.
• Profit-taking led to a late pullback as investors responded to a BTC return to $23,000 for the first time since August.
• However, it was a bearish start to the Sunday session.

Ethereum (ETH) fell by 1.87% on Saturday. Partially reversing a 6.90% rally from Friday, ETH ended the day at $1,627. ETH visited $1,680 for the first time since September 13.

After a mixed start to the day, ETH rose to a late morning high of $1,680 before hitting reverse. Coming up short of the First Major Resistance Level (R1) at $1,703, ETH slid to a late morning low of $1,617. However, steering clear of the First Major Support Level (S1) at $1,577, ETH revisited the $1,660 handle before falling back into the red.

On Saturday, bitcoin (BTC) rose by 0.46%. Following a 7.54% rally on Friday, BTC ended the day at $22,775. Notably, BTC revisited $23,000 for the first time since August.

A mixed start to the day saw BTC fall to an early morning low of $22,427 before making a move. Steering clear of the First Major Support Level (S1) at $21,436, BTC surged to a late afternoon high of $23,353. Coming up against the First Major Resistance Level (R1) at $23,323, BTC eased back to end the day at $22,775.

Profit-Taking and Fed Sentiment Tests Buyers After the Friday Breakout

It was a choppy start to the weekend, with ETH and BTC hitting fresh 2023 highs before hitting reverse. While the talk of an FTX revival continued to provide support, uncertainty toward Fed monetary policy and the US economic outlook supported the late pullback.

The Genesis bankruptcy and increased regulatory risk are also crypto headwinds near term. While an FTX revival would ease the pain, a marked shift in the regulatory landscape is likely.

However, investor sentiment toward the Shanghai hard fork will remain the key for ETH in the coming weeks.

Today, investors should monitor the crypto news wires for updates on the Shanghai hard fork, FTX, and Genesis. In the final hour, the NASDAQ mini will also influence as investors begin to shift attention to the Fed interest rate decision in February.

Ethereum (ETH) Price Action

At the time of writing, ETH was down 0.27% to $1,622. A mixed start to the day saw ETH rise to an early high of $1,637 before falling to a low of $1,603.

Technical Indicators

ETH needs to move through the $1,641 pivot to target the First Major Resistance Level (R1) at $1,666 and the Saturday high of $1,680. A return to $1,650 would signal a breakout session. However, the crypto news wires will have to be crypto-friendly to support a breakout.

In the event of an extended rally, the bulls would likely test the Second Major Resistance Level (R2) at $1,704. The Third Major Resistance Level (R3) sits at $1,767.

Failure to move through the pivot ($1,641) would leave the First Major Support Level (S1) at $1,603 in play. However, barring another broad-based crypto market sell-off, ETH should avoid sub-$1,600 and the Second Major Support Level (S2) at $1,578. The Third Major Support Level (S3) sits at $1,515.

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 $1,552. The 50-day EMA pulled away from the 200-day EMA, with the 100-day EMA widening from the 200-day EMA, delivering bullish signals.

A hold above the Major Support Levels and the 50-day EMA ($1,552) would support a breakout from R1 ($1,666) to target R2 ($1,704). However, a fall through S1 ($1,603) would give the bears a run at S2 ($1,578) and the 50-day EMA ($1,552). A fall through the 50-day EMA would signal a shift in sentiment.

Bitcoin (BTC) Price Action

At the time of writing, BTC was down by 0.12% to $22,747. A mixed start to the day saw BTC rise to an early high of $22,971 before falling to a low of $22,579.

Technical Indicators

BTC needs to move through the $22,852 pivot to target the First Major Resistance Level (R1) at $23,276 and the Saturday high of $23,353. A return to $23,000 would support a bullish session. However, the crypto news wires should be market-friendly to deliver a breakout.

In the event of another extended rally, BTC would likely test the Second Major Resistance Level (R2) at $23,778 and resistance at $24,000. The Third Major Resistance Level (R3) sits at $24,704.

Failure to move through the pivot would leave the First Major Support Level (S1) at $22,350 in play. Barring a broad-based crypto sell-off, BTC should avoid sub-$22,000 and the Second Major Support Level (S2) at $21,926. The Third Major Support Level (S3) sits at $21,000.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bullish signal. BTC sat above the 50-day EMA, currently at $21,133. The 50-day EMA pulled away from the 200-day EMA, with the 100-day EMA widening from the 200-day EMA, delivering bullish signals.

A hold above the Major Support Levels and the 50-day EMA ($21,133) would support a breakout from R1 ($23,276) to target R2 ($23,778) and $24,000. However, a fall through S1 ($22,250) would give the bears a run at S2 ($21,926) and the 50-day EMA ($21,133). A fall through the 50-day EMA would signal a shift in sentiment.