Ethereum price is set to record its second consecutive week of gains as the financial markets hope for a dovish stance by the Fed in coming meetings. However, there may be several rate hikes before the Fed can ease on its policy. As such, the altcoin may remain subject to curbed gains in the short term.
One of the key measures of the cryptocurrency market’s risk sentiment is the crypto fear & greed index. In particular, it tracks the major emotion driving the industry.
Notably, the level of risk aversion has improved in the current week amid hopes that the Fed will ease on its aggressive monetary policy. Compared to last week’s reading of 26, the crypto fear & greed index is at 31. Still, it remains below the neutral level of 50. Besides, as seen on Whalestats, the whale fear & greed index is at an extreme fear level of 5 based on an analysis of the top 100 ETH whale wallets.
Ahead of the Fed meeting set for early February, ethereum price will likely remain subject to curbed gains. While investors are hopeful that the recent inflation data will yield a dovish stance from the US central bank, its evident that the bank is focused on the services inflation that remains persistently high. An environment of high interest rates has been one of the bearish drivers of the broader crypto industry.
Ethereum price prediction
ETH/USD eased on its rally in Friday’s session after five consecutive days in the green. Indeed, it is set to record its second concurrent week of gains. Since the beginning of 2023, the altcoin has rebounded by over 17% as the bulls strive to retest the psychologically crucial level of 1,500.
As seen on its daily chart, ethereum price remains above the 25 and 50-day exponential moving averages. Besides, the formation of a golden cross further signs that the bulls may remain in control of the market in the short term. The aforementioned bullish formation occurs when the short term MA (25-day EMA) crosses the long-term one (50-day EMA) to the upside.
In the short term, I expect ethereum price to continue finding support at 1,367.93 as the bulls strive to break the resistance at 1,500. If that is successful, the next target will be at 1,618.75. However, this bullish thesis will be invalid should the altcoin pullback past the lower support at 1,266.64.