Ethereum Price Forecast: ETH stays muted as uncertainty from Middle East crisis weighs on market sentiment

FXStreet
Updated
Mitrade
coverImg
Source: DepositPhotos

  • Key Ethereum on-chain data has remained muted in the past week.

  • Middle East geopolitical tensions have caused market participants to become less active.

  • ETH extended its consolidation after finding support at $2,450.

Ethereum (ETH) held steady around $2,500 in the early Asian session on Thursday following mixed activity across its on-chain data.

Ethereum on-chain data stays muted following Middle East war tension

Ethereum is experiencing calmness in its on-chain metrics following an extended period of price consolidation that has spanned the past six days after dropping from above $2,700.

US spot Ethereum exchange-traded funds (ETFs) have seen considerable drops in inflows, registering just $32 million in net inflows over the past two days, according to SoSoValue data. This is in contrast to last week when it saw over $170 million in the first two days of trading.

Exchange net flows have also been largely mixed, with a combination of inflows and outflows over the past week, indicating a struggle for direction among market participants. A similar picture is evident in Ethereum futures, where open interest has remained flat in the past six days.

ETH Exchange Netflows. Source: CryptoQuant

The calm in the market follows the US Federal Reserve's decision to hold rates steady at 4.25-4.50% on Wednesday amid ongoing concerns about US tariffs and a resumption of Middle East war tensions.

"Markets are increasingly focused on a potential realignment in Middle Eastern power structures and the implications this may have for regional geopolitics as the US, Russia and China are all involved by proxy," said QCP analysts in a note to investors on Wednesday.

"Tehran is cornered, a disruption or full blockade of this critical chokepoint becomes a credible tail risk. The strait accounts for a significant share of global crude oil flows, and any supply shock would have a pronounced inflationary impact," they added.

As a result, investors are employing risk-off strategies to hedge against downside risk, while others remain muted. On Deribit, the largest options exchange, investors have bought an increased amount of puts around the $2,450 to $2,500 strike price over the past 24 hours, making this level a critical point of volatility in the coming days, according to data from Amberdata.

Put options are contracts that give the buyer the right but not the obligation to sell an underlying asset at a specific price (strike price) before the contract expires. It represents a downside price prediction. When prices move below a puts' strike price, the contract becomes "in the money" or in profit.

"This geopolitical stress is layered atop an already fraught global macro environment, marked by stubbornly elevated inflation and a global reset in tariff regimes. The so-called Tariff War may have fizzled with little fanfare, but investor attention has swiftly migrated to the Middle East," the analyst said.

Ethereum Price Forecast: ETH extends consolidation amid weak volumes

Ethereum experienced $64.61 million in futures liquidations, with long and short liquidations totaling $35.61 million and $29 million, respectively, over the past 24 hours, according to Coinglass data.

Ethereum continued consolidating on Wednesday, holding the $2,450 support at the 38.2% Fibonacci Retracement. If ETH could cross above the 50-day Exponential Moving Average (EMA), it could quickly rise to test the $2,850 resistance. To overcome the $2,850 key resistance, ETH needs a surge in volume accompanied by strong bullish sentiments.

ETH/USDT 8-hour chart

On the downside, a move below the 38.2% Fibonacci level and the lower boundary of a key channel could send ETH toward the $2,260-$2,110 range.

The Relative Strength Index (RSI) and Stochastic Oscillator (Stoch) are below their neutral levels and moving sideways, indicating a dominant bearish momentum.

* The content presented above, whether from a third party or not, is considered as general advice only.  This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.

goTop
quote
Do you find this article useful?
Related Articles
placeholder
Dogecoin (DOGE) Rockets to $0.20 — Can It Go Even Higher?Dogecoin started a fresh increase above the $0.180 zone against the US Dollar.
Author  NewsBTC
Yesterday 06: 41
Dogecoin started a fresh increase above the $0.180 zone against the US Dollar.
placeholder
Bitcoin's surge to new all-time high sparks $1 billion in short liquidationsBitcoin (BTC) traded above 4% on Thursday after soaring to a new all-time high above $116,800. The rally, which appears to be leverage-driven, triggered over a $1 billion short-squeeze across the entire crypto market.
Author  FXStreet
Yesterday 03: 24
Bitcoin (BTC) traded above 4% on Thursday after soaring to a new all-time high above $116,800. The rally, which appears to be leverage-driven, triggered over a $1 billion short-squeeze across the entire crypto market.
placeholder
Bitcoin crosses $117K as Ether hits $3,000 and XRP surges by 5%Bitcoin is now sitting above $117,000 for the first time in its history, rising more than 60% since its lowest point in April.
Author  Cryptopolitan
Yesterday 01: 39
Bitcoin is now sitting above $117,000 for the first time in its history, rising more than 60% since its lowest point in April.
placeholder
Ethereum Price Forecast: ETH tests $3,000 following strong ETF and treasury inflowsEthereum (ETH) climbed above $2,900 on Thursday, mimicking the rally seen in Bitcoin.
Author  FXStreet
Yesterday 01: 36
Ethereum (ETH) climbed above $2,900 on Thursday, mimicking the rally seen in Bitcoin.
placeholder
Crypto market sees $500 million in liquidation as Bitcoin hit record highs amid dovish Fed minutesThe crypto market continues to trade in the green on Thursday, following the previous day's surge as Bitcoin (BTC) reached a new all-time high of $111,999.
Author  FXStreet
Jul 10, Thu
The crypto market continues to trade in the green on Thursday, following the previous day's surge as Bitcoin (BTC) reached a new all-time high of $111,999.
Real-time Quote