As of October 25, 2023, 15:00 (UTC+8), the eth usd price real-time quotation was $1,600. In 24 hours, the peak was $1,630 (+1.8%), and the low was $1,560 (-2.5%), with a 4.3% fluctuation range. The 30-day volatility (standard deviation) was 2.1%, greater than Bitcoin’s 1.8%. The current circulating market capitalization of Ethereum is 192 billion US dollars, and the 24-hour trading volume is 8 billion US dollars. Of them, Binance Exchange takes up 38% (3.04 billion US dollars), and Coinbase Pro takes up 15% (1.2 billion US dollars). The main reasons for the abnormal price action are the Federal Reserve’s interest rate expectation and the technological innovation of Ethereum’s “Cancun Upgrade.”
Technical indicators show a struggle between bulls and bears. The daily RSI of eth usd price is 55 (mid-range), and the 4-hour MACD converges along the zero axis. If it breaks through $1,650 (higher Bollinger Bands), it may trigger the liquidation of $180 million of short contracts (CoinGlass data), with the aim targeting $1,700. If it breaks through $1,550 (the 50-day moving average), or below $1,480 (the 61.8% Fibonacci retracement level). On-chain data shows that “whale” addresses with over 10,000 ETH net offloaded 120,000 ETH (approximately 192 million US dollars) to exchanges in the past week, and the strength of selling pressure is at the 85th percentile of the year (Glassnode), with exchange reserves raised to 12.5% of the circulating amount (their highest this year).
Macro economic pressure is high. The yield on the 10-year US Treasury rose to 4.8% (a 2007 high), lowering the value of risky assets. Based on historical data, when the yield is above 4.5%, the median 30-day yield of ETH is -7% (2018-2023 data). There’s a 22% probability the Federal Reserve will raise interest rates by 25 basis points in November (CME FedWatch). If so, the total market value of cryptocurrencies would fall by 10%-15%, and the total eth usd price would fall to $1,450- $1,500 (Goldman Sachs model). But the good news is that the application for BlackRock Ethereum Spot ETF (with a 35% approval rate) was filed. If sanctioned, it would bring a monthly net inflow of 800 million US dollars (using a gray-scale calculation), pushing the price back to 1,800 US dollars.
On-chain activities reflect network demands. The average Gas fee on the Ethereum network has dropped to 15 Gwei (approximately $1.2), whereas the average number of transactions per day on Layer2 stands at 3 million (increased by 25% from the last month), but staking volume has dropped to 26 million ETH (representing 21.5% of the circulating supply). Signal differentiation in the derivatives market: Deribit’s ETH options’ implied volatility climbed to 60% (previously at 30-day average 45%), and the open number of call options with strike price $1,700 had risen to 200,000 ETH (nominal value of $320 million), but the perpetuals’ funding rate turned negative (-0.01%). If the price drops below $1,580, It may lead to a long margin call of 350 million US dollars.
Regulatory dynamics is a near-term catalyst. When the SEC sued Coinbase, there was this statement that “Ethereum can be considered as a security”. If such an impression gains acceptance during the hearing on November 2nd, the eth usd price can drop by 20%-30%. Conversely, if the BlackRock ETF is approved, it may replicate the listing effect of the Bitcoin futures ETF – after the approval of the ProShares Bitcoin Futures ETF in October 2021, BTC rose by 19% within a week.
Operation suggestions:
Short-term trading: If it stabilized above $1,600, a small long position can be taken up to $1,680, with a stop-loss at $1,550.
Event hedging: Purchase a December expiration $1,500 put option with an approximated 5% premium held to catch downside hedges;
Long-term positioning: Assume additional positions since the average price of regular investments drops below $1,500 to expect breaking $2,000 after the 2024 “Cancun Upgrade”.
Risk Warning: Celsius halted withdrawals in June 2022, which plunged ETH 15% in one day. When the same liquidity crisis occur again, the price of eth usd may lose 10% to 15% at once. Exchange risks should be hedged through limit orders and diversification into cold wallets.