April 16, 2024

The price of Ethereum continues to struggle below $1,600 despite the Merge being successful. As pointed out previously, the Ethereum Merge had looked to be a “buy the rumor, sell the news” event, which seems to be playing out, but the lack of highly fluctuating prices suggests that even the expected sell-offs seemed not to have happened. Instead, it looks to be that momentum is currently muted, making it impossible for the price to swing either way.

Merge Is Priced In

During the rallies that led up to the Ethereum Merge, there were debates on whether the upgrade had been finally priced into the value of the digital asset. At one point, ETH had rode the wave up to $2,000 but quickly lost its footing. Given this, it was a matter of what would be best for the digital asset.

Now, after the Merge has been completed, it seems more settled that the price had already been priced in. For market analyst Julius Baer, he says that the best-case scenario would have been for the Merge to end up being a non-event. If this is true, then the current resistance to any sort of significant movement on the part of the digital asset is a good thing. 

Merge fails to move ETH price | Source: ETHUSD on TradingView.com

However, it is concerning that such a highly anticipated event seemed to have no bearing whatsoever on the price movement of the digital asset. But the market decline that followed the release of the CPI data earlier in the week has likely led to fatigue in the market. 

Can Ethereum Rebound From Here?

Before the Merge, the price target from Ethereum had been $2,000, given the upward momentum that was recorded during that time. However, the dip in price has put the digital asset in an especially difficult position.

With the price dropping to the $1,590 territory, the cryptocurrency is unable to properly clear important technical levels like the 50-day moving average. Additionally, the 100-day moving average looks worse. This spells the likelihood of more bearish movement over the next week.

The sell-offs have also not eased over the last couple of weeks. Ethereum had recorded massive exchange inflows leading up to the Merge, bringing the 7-day inflow volume to $11.52 billion. This large inflow volume, coupled with the decline below the 50-day moving average, has caused the 50-day MACD to skew heavily towards the selling pressure.

The next major support level for the digital asset now lies at $1,500. However, a failure to properly hold this level will likely see Ethereum test the $1,300 territory once more. 

Featured image from CNBC, chart from TradingView.com

Follow Best Owie on Twitter for market insights, updates, and the occasional funny tweet…

Source link