Why is Ethereum holding strong despite inflation?

[CryptoChamp]

Let’s take a closer look at Ethereum’s recent market performance and what traders are expecting next.

Current Ethereum Price & Market Overview

• Current Price: $2,364.72
• Market Cap: $9.42 billion

Ethereum price has been moving within a defined range, holding support at $2,250 and facing resistance at $2,490. Traders are closely watching these levels to gauge the next move.

Ethereum’s Performance vs Bitcoin 

Ethereum hasn’t seen as much enthusiasm around spot ETFs as Bitcoin. Data from Glassnode highlights that:

• Bitcoin ETFs account for 8% of the spot volume.
• Ethereum ETFs contribute just 1% of the spot volume.

This indicates that while both cryptocurrencies have ETFs, Bitcoin is clearly benefiting more from their introduction.

Macro Impact on Ethereum: Inflation and Interest Rates

Recent inflation data came in higher than expected, dampening hopes for a 50-basis-point rate cut at the upcoming FOMC meeting. Initially, this economic news affected the entire crypto market.

• Ethereum briefly dropped, but it managed to bounce back to the mid-$2,300s by market close.
• Bitcoin also recovered and was trading just shy of $58,000, though it's still down 0.47% for the week and 1.89% since the start of September.

Traders Are Bullish on Ethereum

According to CoinGlass, there’s growing confidence in Ethereum’s upward momentum:

• 58.15% of top traders are holding long positions, while 41.85% are short.
• The Long/Short ratio is currently at +1.392, which signals a bullish outlook.

This data suggests that traders believe Ethereum is poised for an upside rally in the coming days.

Rising Open Interest Signals Positive Momentum

Another key indicator of bullish sentiment is the increase in Ethereum futures open interest:

• Open interest has gone up 2.3% in the last 24 hours.
• This marks the fourth consecutive day of rising open interest, indicating that more traders are betting on higher prices.

Analyst Predictions: Is $4,400 Next?

Crypto analyst Kaleo has shared an optimistic forecast for Ethereum. According to him, the current price patterns indicate a possible move up to $4,400. He sees the formation of a local bottom as a strong indicator of this potential rally.

What’s Next for Ethereum?

• Support Level: $2,250
• Resistance Level: $2,490

With bullish sentiment among traders and a positive technical setup, Ethereum could be gearing up for a significant rally. Keep an eye on the key support and resistance levels as the market continues to evolve.

Final Thoughts

Ethereum has shown resilience despite recent economic headwinds. With traders leaning towards long positions and open interest on the rise, the outlook appears positive for the cryptocurrency. Stay tuned for further developments, as a breakout could be on the horizon.