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Can Ethereum price reclaim $2,400 as it eyes a bullish reversal amid market recovery?

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Ethereum price has formed a bearish flag on the daily chart.

Ethereum bulls pushed its price to nearly $2,200 on Thursday amid a market-wide recovery.

Summary

  • Ethereum price rebounded to a 4-week high on Friday amid increased demand from institutional traders and a surge in short liquidations.
  • ETH has formed a double bottom pattern on the daily chart.

According to data from crypto.news, Ethereum (ETH) price rallied over 11% to a 4-week high of $2,192.

Ethereum price rallied amid a broader market recovery led by Bitcoin. The bellwether reclaimed the $73,000 mark for the first time since early February as reports emerged that the U.S. and Iran could be negotiating a deal to end their military confrontation. 

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As ETH price rose, it triggered a short squeeze of traders with highly leveraged bearish bets in the derivatives market. Data from CoinGlass show over $133 million in short positions were liquidated in the past 24 hours, compared to only $21.5 million in long positions.

A return of inflows into spot Ethereum ETFs also seems to suggest that institutional investors had played a significant part in the recovery. Per data compiled by Farside Investors, spot Ethereum ETFs drew in $169.4 million yesterday.

Simultaneously, Ethereum’s open interest shot up nearly 15%, which is a sign of increased derivatives market activity after multiple days of stagnation. While the weighted funding rate remains negative at press time, if it continues to climb, a shift toward positive funding rates could signal a return of bullish sentiment. 

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This surge in activity suggests that traders are once again aggressively positioning themselves, potentially setting the stage for more volatility if the price breaks key resistance levels.

On the daily chart, Ethereum price has formed a double bottom pattern, a major bullish reversal pattern formed of two consecutive troughs. The neckline of the pattern lies at the $2,200 psychological resistance level.

Ethereum price has formed a bearish flag on the daily chart.
Ethereum price has formed a bearish flag on the daily chart — March 5 | Source: crypto.news

A breakout from the neckline could push Ethereum to $2,400, which aligns with the 38.2% Fibonacci retracement level that is often seen as a critical target for a trend reversal.

It should also be noted that a successful reclaiming of the $2,400 mark would invalidate a larger bearish flag pattern forming on the chart.

Key technical indicators seem to suggest that bulls are already on the move. Notably, the MACD lines have formed a bullish crossover and were pointing upwards, while the Aroon Up showed a reading of 92.86%, far above the bearish indicator at 35.71%.

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For now, traders are eyeing $2,142, the 23.6% Fibonacci retracement level, as a key resistance. ETH was trading at $2,117 when writing, just 1.1% below that mark.

Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.

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Crypto World

Morgan Stanley Sets Bitcoin ETF Fee at Ultra-Low 0.14%

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Morgan Stanley Sets Bitcoin ETF Fee at Ultra-Low 0.14%

Investment bank Morgan Stanley is seeking to launch its spot Bitcoin exchange-traded fund at a 0.14% fee, which would make it the cheapest in the US market and potentially force rivals to cut fees to stay competitive.

The 0.14% fee, proposed in Morgan Stanley’s latest S-1 registration statement on Friday, would be one basis point below the Grayscale Bitcoin Mini Trust ETF (BTC), currently the cheapest in the US market, and 11 basis points below the BlackRock-issued iShares Bitcoin Trust ETF (IBIT).

“Big move here. They are not messing around,” Bloomberg ETF analyst James Seyffart said, predicting that the Morgan Stanley Bitcoin Trust (MSBT) is “likely to launch in early April.”

Source: James Seyffart

Fellow Bloomberg ETF analyst Eric Balchunas said the low fee means that none of Morgan Stanley’s roughly 16,000 financial advisors — which manage $6.2 trillion in client assets — would feel conflicted in recommending the product to its clients.

Given that spot Bitcoin ETFs track the price movements of Bitcoin (BTC), Morgan Stanley’s ultra-low fee could spark a fresh fee war in the $83 billion market, putting immediate pressure on rivals to cut costs or risk losing assets.

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Regulatory approval would make Morgan Stanley the first bank to issue a spot Bitcoin ETF, expanding access to Bitcoin exposure for millions of its high-net-worth clients.

“They are the ultimate gatekeepers of rich boomer money,” Balchunas added.

Morgan Stanley previously selected Coinbase and Bank of New York Mellon as the proposed custodians for its Bitcoin ETF.

Morgan Stanley seeking suite of crypto ETFs, banking charter

Morgan Stanley, previously one of the more crypto-hesitant Wall Street firms, filed for the spot Bitcoin ETF in the first week of January, along with a Solana (SOL) ETF.

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Related: Bitcoin traders see 53% odds of sub-$66K BTC by April 24 

It then filed papers for a staked Ether (ETH) ETF later that week, and by the end of the month, the bank appointed one of Morgan Stanley’s longest-standing executives, Amy Oldenburg, to lead its digital asset team.

Source: James Seyffart

Morgan Stanley also applied for a national trust banking charter on Feb. 18, seeking to custody certain digital assets and execute purchases, sales and swaps for clients in addition to staking services.

In October, before the investment bank adopted its institutional crypto strategy, it recommended a 2% to 4% allocation to crypto portfolios for investors. It also allowed its financial advisors to recommend crypto funds to clients with individual retirement accounts (IRAs) and 401(k)s.

Magazine: Bitcoin may face hard fork over any attempt to freeze Satoshi’s coins

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