The price of ETH is still holding the resistance at $1600, which indicates that the current rally has no sustained momentum.
Ether
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Below is the sticker
$1694
The price is struggling to break the $1,600 resistance level for the third time since September. Some say a 33% year-over-year increase could mean it could wipe out a $200 billion market cap.
Ether/USD 2-Day Price Index Source: TradingView
If the price of Ether rises above $1,600, the #1 cryptocurrency will return to the world’s top 60 trading assets, surpassing international firms such as Nike (NKE), Novartis (NVS), Cisco (CSCO) and Toyota (TM). Looks great. . . . . . . . . . . . . .
Unfortunately, at least for bull traders. The futures market does not indicate that Ether will finally break the $1,600 resistance – at least not until the Federal Reserve changes its approach to tightening the economy.
The bull market’s disappointment was partly explained by Silvergate Bank’s $1 billion quarterly net loss. The bankable cryptocurrency laid off about 40% of its workforce on January 5 and is currently facing a class-action lawsuit against FTX and Alameda Research.
The negative news continued on January 17, when Mamoru Yanase, deputy director general of the Japan Financial Services Agency’s Strategy, Development and Regulation Office, argued that traditional banks and brokers should be “worried” in the crypto sector. Same rules
Ether continued to trade positively above $1,500, but was closely watched by the recent price move. The Russell 2000 index rose 8%. In addition, investors fear that data showing a drop in inflation will be the main driver of a correction in the cryptocurrency market, so any gap in the stock market could lead to another sell-off.
As a result, investors believe that Ether could recapture its recent gains if the Federal Reserve raises interest rates. Let’s take a look at Ethereum derivatives to understand how the unexpected pump has a positive impact on investor sentiment.
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A 33% increase in airtime is not enough to increase credibility.
Traders avoid quarterly futures contracts because of price differences compared to the market. Professional traders now prefer these instruments because they hedge the volatility of interest rates on futures contracts.
In a healthy market, a 2-month futures premium should be in the range of +4% to +8% to cover annualized costs and risks. A normal placement indicates a lack of confidence among buyers. This indicates a decrease
2 Months Bonus Ether Future Source: Levitas
The chart above shows that there are bullish traders as the Ether futures premium is below the 4% threshold, indicating a lack of demand from buyers. These investors do not expect price action to worsen.
Therefore, traders should analyze the market of Ether parameters, the price is likely to be surprised by negative price movements.
The neutral options market is raising resistance at $1.6k
A 25% delta diagonal is a telltale sign when market makers and speculative offices charge higher fees for increasing or decreasing storage.
In a bear market, traders pay a lot for preferred deposits. That’s more than 10%. On the other hand, bull markets move the smooth rate below -10%, which means that later options are discounted.
Ether option 60 days 25% Diagonal delta: Source: Laevitas.ch
Since January 14th, the values of the delta cabinet have improved. Prices are neutral to neutral with a positive 10% decline. This move suggests that traders are becoming more comfortable with downside risks. Because the 60-day delta is negative by 2%.
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Whale market makers are not as optimistic as the options market. But the absence of fear was cheered after it rose 33 percent, with traders in the options and futures markets fearing that the $1,600 resistance would have a negative impact on prices.
Source: CoinTelegraph
