Ethereum broke back above $2.5K on Friday, extending its recovery from a mid-year low near $1.5K, even as spot ETF outflows and a negative Coinbase Premium Index suggest the bounce hasn't been driven by consistent spot demand.
Ethereum has jumped past the $2.5K level after rebounding sharply from its mid-year lows, though it remains below several important higher-timeframe resistance levels.
Moving averages close in on a bullish cross
On the daily chart, ETH has recovered from the $1.5K support area and pushed back above both its 100-day and 200-day moving averages. The 100-day average is pushing toward the 200-day from below, and the two are likely to form a bullish crossover around $2K.
A breakout above $2.5K could open the way to the next resistance near $3.0K, with the broader daily resistance zone at $3.3K-$3.4K beyond that. On the downside, the first support sits around $2.1K, where the moving averages are clustering, followed by $1.9K. Meanwhile, the daily RSI is in the mid-to-upper 50s, so momentum stays bullish without an overbought reading.
Rate hike decision and ETF outflows accompany the bounce
Wednesday's rate hike decision has given investors reason to pause and reassess their bullish conviction, since further hikes to combat inflation would tighten liquidity in the market. Spot Ethereum ETFs have also seen $407.3 million in cumulative outflows over the past three trading days, according to Farside Investors data cited by AMBCrypto.
Still, Santiment noted that Ethereum's transaction costs have dropped considerably as mainnet demand softened, even as the price recovered through July and August.
Coinbase Premium stays negative despite the rally
The Coinbase Premium Index, which tracks buying pressure from Coinbase's largely U.S.-based market, is currently around -0.07 and has spent much of the recent period below zero. That is notable: ETH has recovered from roughly $1.5K to around $2.5K, yet the premium has stayed negative through most of that advance, suggesting the bounce hasn't been driven by consistent U.S. spot demand.
A sustained move back above zero, alongside a breakout above $2.5K, would add confirmation that spot demand is strengthening.
Sources: CryptoPotato, AMBCrypto
Trading involves risk.
Risk Disclaimer
