How the approval of futures ETFs will affect the price of Ethereum (ETH)
Date: 2023-08-20 Author: Karina Ziganova Categories: BLOCKCHAIN
Despite the negative on the crypto market, Ethereum still managed to stay above an important support level. Recent media reports about the possible approval of ETH futures ETFs may play into the hands of holders of the asset.
The price of Ethereum rebounded to around $1,700 after Bloomberg, citing anonymous sources, reported a high probability of approval of a number of applications for ETF futures by the US Securities and Exchange Commission (SEC). The material mentioned the petitions of such large Wall Street companies as ProShares, Volatility Shares, Bitwise and Roundhill.
Ethereum whales get rid of coins
Data from key on-chain metrics shows that the Ethereum whales did not buy into the recent Bloomberg report and continue to get rid of coins, despite a small price rebound recorded on Friday after a strong sell-off.
As you can see in the chart below, between July 14 and August 18, addresses with a balance between 10,000 and 100,000 reduced their holdings by 1.12 million tokens worth about $1.86 billion.
The trading activity of this group of whales is closely correlated with the dynamics of the price of Ethereum, so it is not surprising that the asset quotes sank significantly against the backdrop of a large-scale sale.
However, if the official SEC statement confirms the recent Bloomberg report, the mood of large investors may well change to bullish.
ETH price is approaching the oversold zone
After an active sale by whales, Ethereum seems to have plunged into an oversold zone. According to the Relative Strength Index data, the daily RSI for August 18 closed at 14. This means that 86% of daily ETH price movements over the past two weeks were in a downtrend.
A drop in RSI below 30 could signal a reversal is imminent.
Ethereum price prediction: bulls are ready to buy back the fall to $1500
As the RSI is currently in oversold territory, the ongoing sell-off may gradually fade away. This forecast is also confirmed by the On-chain Market Depth chart, which tracks the distribution of current active orders.
As shown in the chart below, traders placed buy orders for 50,720 ETH at $1,500. However, if the bearish sentiment on the market increases, the asset quotes may sink to $1,400 and rebound from these values.
Conversely, Ethereum bulls may react to reports of futures ETF approvals by making another attempt to recapture the $1,900 milestone. However, traders who opened orders to sell 25,380 ETH at $1,825 will slow down the move up.
