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This could send Ethereum’s rally back to $1,700, beware the pants

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Ethereum has almost regained gains from the previous weeks with yesterday’s bullish move and could be preparing for another push above the resistance level. The second cryptocurrency by market capitalization is following the general sentiment in the market and is seeing some respite after reducing the impact of macro forces for the time being.

At the time of writing, Ethereum (ETH) is trading at $1,330 with a gain of 9% in the last 24 hours and a loss of 2% over the past week. In the top ten list of cryptocurrencies, ETH is one of the best performing assets along with Solana (SOL) and Bitcoin (BTC).

Ethereum ETH ETHUSDT
ETH price is moving sideways on the 4 hour chart. source: ETHUSDT TradingView

Will Ethereum Bulls ever come out of the shorts?

Yesterday, the cryptocurrency market witnessed high volatility on the back of the report on the US Consumer Price Index (CPI), the benchmark for inflation in this country. The gauge printed 8.2% for September, beating expectations, pushing Bitcoin and Ethereum below critical support.

After taking liquidity to the downside, the market bounced back into the range that was cutting short and long positions. According to a pseudonymous trader, the volatility has not been able to liquidate sellers who are betting on further downward movement of the Ethereum price at its current levels.

These positions accumulate for several weeks, pushing the open interest (OI) of Ethereum futures to new highs. In the coming days, if the bulls can maintain the bullish momentum, then liquidating these positions could provide fuel for a rally to the $1700 area where ETH price stood before the “consolidation.” pseudonym dealer pointed the following:

Despite the current volatility and the huge amount of long liquidations, open interest is still very high. Obviously, there is still a whole bunch of shorts open. The fact that they didn’t cover much at all in the low range indicates greed. They should shut down for a while.

If the shorts are eliminated, how high can ETH go up?

As mentioned, the biggest cryptocurrencies are back in the range they’ve been in for over a month. Hence, the pseudonymous trader believes that Ethereum could break the local resistance around $1,300 and push towards the $1,400 region.

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As seen in the chart below, yesterday’s bearish price action was violent but short-lived. Something similar can happen to the upside if short positions are liquidated.

Meanwhile, with the low volume weekend approaching, the cryptocurrency market could retest the lower levels before gathering momentum for a new rally. This could put Ethereum at the top of its channel, as shown in the chart below, at $1,400. Merchant alias added:

Given that the total CPI dump has been fully corrected on such a large scale, I am inclined to believe that we are now beginning our adventure again towards the top of the range. Area 1200 makes sense for a long time, it doesn’t make sense to be short, at least in my head.

Ethereum ETH ETHUSDT 2 . Chart
Could ETH price return to the top of this channel? Source: Byzantine general
(ByzGeneral) via Twitter

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Cryptocurrency

Sam Bankman-Fried is dealing with an $8 billion balance sheet deficit

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The entire cryptocurrency market suffered multiple losses and asset depreciation after the collapse of Sam Bankman Fried cryptocurrency exchange FTX. Additionally, cryptocurrencies exposed to FTX have had their fair share of bitter pills.

Investigations were underway to locate the $8 billion hole in FTX’s balance sheet, which caused the liquidity crisis.

FTX’s balance sheet deficit continued to grow. The company initially announced only $2 billion and later said it was $5 billion. The hole has now grown to more than $8 billion.

In a recent interview with Bloomberg, Sam Bankman-Fried (SBF), the former CEO of FTX, revealed the whereabouts of the funds. The SBF said it showed investors a separate balance sheet in an emergency bailout.

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According to the ReportSBF listed $8.9 billion in debt, $9 billion in liquid assets, and $15.4 billion in liquid assets. The report also mentioned $3.2 billion in illiquid assets.

Sam Bankman-Fried reveals conflicting balance sheets

He disclosed another balance sheet showing the actual situation at the time of the bailout meeting. The balance sheet carries similar numbers but $8 billion less in liquid assets. The SBF said it misquoted the numbers.

He added that customers were transferring money to Alameda Research instead of sending it directly to FTX. According to his statement, FTX’s internal audit system double-counted the amount and credited it to both companies.

After the SBF statement, FTX and Alameda Research had the highest cash flow, but Binance, the competitor, had the highest cost. He paid $2.5 billion net worth to buy Binance investments. The SBF also revealed that it spent $250 million on real estate and about $1.5 billion on other expenses.

About $4 billion and $1.5 billion went to venture capital investments to acquire other companies, while it miscalculated $1 billion.

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The report also stated that the SBF and the remaining staff had spent the previous weekend trying to raise money. The funds will fill the $8 billion hole in FTX’s balance sheet and reimburse clients.

The reason for the collapse of FTX: fraud or mismanagement?

Meanwhile, most people in the crypto space say that the FTX crisis is a scam, not a coincidence. On Wednesday, during his first public appearance after the collapse of FTX, Bankman-Fried insist on He did not commit fraud. He claimed he was unaware of the extent of the damage and what was going on with FTX.

In an interview with The New York Times, the SBF blamed the collapse of the $32 billion exchange FTX on poor accounting and management failures. This comment sparked civil and criminal investigations. The investigation aims to determine whether FTX committed a crime by lending client money to Alameda Research.

Cryptocurrency market records new gains | Source: Crypto Total Market Cap on TradingView.com

However, FTX’s new CEO, John Ray III, who is in charge of the company’s bankruptcy proceedings, expressed his disgust at the situation. In his words, Ray said he had never seen such a complete failure of corporate control, and condemned the SBF for its unacceptable management practices.

Featured image from Texas Tribune, chart from TradingView.com

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Everything Bubble: Markets at a Crossroads – Bitcoin Magazine

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Below is an excerpt from a recent issue of Bitcoin Magazine Pro, Bitcoin Magazine Premium Markets Newsletter. To be among the first to receive these insights and other on-chain bitcoin market analysis straight to your inbox, subscribe now.

Powell’s Speech and Contracting ISM PMI

We want to zoom out, revisit and analyze some of the latest data that came out this week, which will greatly influence the direction of the market over the next few months.

After Jerome Powell’s Brookings speech, markets are clearly chomping a bit to move higher with any possible pivot scenario and narrative from the Fed. There is over-hedging, short-squeezing, options market dynamics and forced buying. This goes beyond our experience to say exactly why markets explode with volatility at any given data point or Powell’s new speech. However, these types of events and market movements have almost always been a sign of unhealthy and growing volatility in bear markets. Despite more talk from Powell with nothing really new to say, the speech was seen by markets as “more dovish” with his comment about worrying about excessive rate hikes. However, if this is yet another bear market rally forming for the major indices, we’re apparently close to turning that high again.



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Price Analysis 12/2: BTC, ETH, BNB, XRP, ADA, DOGE, MATIC, DOT, LTC, UNI

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Bitcoin and altcoins are starting to signal a possible trend change, but there are still a few downside risks.

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