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▲ Ethereum (ETH), decline/AI-generated image ©
With the re-acceleration of inflation and escalating tensions in the Middle East, Ethereum is being tested to defend its $2,211 support level.
According to investment media outlet FXStreet on April 30 (local time), Ethereum (ETH) was trading around $2,260 on that day. The US March Personal Consumption Expenditures (PCE) price index rose 3.5% year-over-year, higher than February's 2.8%, and the core PCE, excluding food and energy, increased by 3.2%, reaching its highest level since November 2023.
Rising inflation is a factor that lowers the possibility of interest rate cuts, putting pressure on investment sentiment for risk assets like cryptocurrencies. With ongoing geopolitical tensions in the Middle East, investors are adopting a more defensive stance in the Ethereum futures market.
According to CryptoQuant, the 14-day moving average of the taker buy/sell ratio for Ethereum perpetual futures has been declining since mid-April, falling below the neutral line. Funding rates also remained in negative territory during the same period, indicating a dominant bearish sentiment, and open interest, after decreasing from 14.4 million ETH on April 18, has hovered around 13.5 million ETH.
Pressure also remains in the spot market. Ethereum's realized price, or the on-chain average acquisition cost, is $2,308, acting as a major resistance level. As the price has failed to settle above this level, selling movements from investors who have reached their break-even point continue. The recent 24-hour liquidation volume was $38.2 million, with short position liquidations accounting for $19.5 million of that.
Technically, Ethereum remains below the 20-day exponential moving average of $2,287 and the 100-day exponential moving average of $2,365, maintaining a short-term bearish trend. After failing to break through the $2,388 resistance, the previous uptrend line has also turned into resistance around $2,353. On the downside, the 50-day exponential moving average at $2,244 and the horizontal support level at $2,211 are the first defense zones, and a break below them could open up further downside potential to $2,108, $1,909, and $1,741.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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