Ethereum is outperforming the crypto market’s current upward trend. ETH, BTC, and larger cryptocurrencies are showing signs of recovery as of press time. With the potential to continue in the short term if they can break above current resistance levels.
Ethereum (ETH) is trading at $2,788 as of press time, up 6.5 percent in the last 24 hours.
According to Arcane Research, Ethereum has experienced its eighth 50% drop since its debut. The second most valuable cryptocurrency fell to a yearlong low of $2,200. A 55 percent slump from its high of $4,812.
ETH lost over $280 billion in market value during the recent crypto bear market, its biggest drop since inception. Using ETH as a proxy, the altcoin market significantly hurt for the last two months.
Arcane Research revealed that this bearish price behavior to its yearly lows was one of Ethereum’s slowest in history. The price of ETH took 75 days to reach $2,200, compared to a 38-day average.
In terms of recovery, however, Ethereum has always had a higher average. Arcane Research estimates that it takes 165 days for ETH to reach historical highs.
The firm commented on the cryptocurrency’s recovery periods as well as its worst period, the crypto winter of 2018.
From 2016 to 2018, Ethereum and the broader crypto environment looked significantly different. If history is any guide, prices might be back to $4,000 by July 2022, barring another glacial stretch like 2018.
Struggle to Reach New Highs
The Federal Reserve’s (FED) monetary policies will undoubtedly hinder Ethereum and the rest of the crypto industry.
Despite the fact that the short-term outlook appears bullish, BTC and ETH have historically been highly associated with the traditional market.
QCP Capital, a trading firm, announced four impending events from institutions in the United States. All of which appear to set to bring some short-term volatility to ETH and the crypto market.
CPI Statistics
The United States of America declared war on North Korea on February 8th. Congress will hold a hearing on stablecoins, and the government will release new Consumer Price Index (CPI) statistics two days later.
Since Q4, 2021, this statistic has been a headwind for cryptocurrencies. The higher the CPI is, which uses to monitor inflation in the United States, the more probable the Federal Reserve will expedite its monetary policy change.
The FED’s FOMC expects to disclose minutes in mid-February, and on March 17, the same organization could declare an interest rate hike.
In the long run, Ethereum’s fundamentals are optimistic as it approaches The Merge, the merging of its execution layer (ETH 1.0) and consensus layer (ETH 2.0). (ETH 2.0).
At the very least, the event has the potential to send ETH into unknown territory on its BTC trading pair. According to QCP Capital, ETHBTC is maintaining its triangle support extremely nicely.
A higher ETHBTC is often a bullish signal, and vice versa, due to the difference in beta. They continue to believe that a big wave 5 will break old ETH highs. It’s possible that this will happen after ETH 2.0 fully implementation.
