Ethereum jumped in January 2023 with the rest of the crypto market to recoup some of the losses from the extended bear market of 2022. It started the year at $1200 and peaked at $1713.
Indicators especially on Ethereum derivative contracts show that selling pressure is building on the asset. Will Ethereum manage to hold that crucial $1500 level. Currently, Ethereum is trading at around $1550 according to CoinMarketCap.
Over the past 12 months, Ethereum has lost nearly 52% of its value in the wake of a struggling crypto market. Ethereum has seen its attempts at a bullish push pushed back by a powerful resistance at around 1700 dollars.
Ethereum is among the cryptos leading the charge in developing a new trend. Network developments, upgrades and economic adjustments within the Ethereum ecosystem have their own way of influencing the DeFi segment of the market.
Additionally, as the Layer 1 protocol with the largest number of products, Ethereum’s influence on the crypto-market is increased.
However, recent SEC announcements regarding Kraken or even Paxos, the issuer of the BUSD, are not likely to reassure investors and traders. Indeed, the regulatory environment seems to be getting tougher and calls for investors to be cautious.
The SEC’s attacks against staking via the procedure initiated against Kraken are particularly worrying. The consequences on DeFi could be important. It is therefore a crucial element to monitor in the coming weeks.
Ethereum, in February 2023!
Since the full transition to the supposedly more scalable Proof-of-Stake consensus algorithm, the Ethereum network has undergone a series of upgrades.
These upgrades are intended to allow the full expression of the new network structure. The year 2023 looks to be a year where many of these upgrades will be implemented.
One major upgrade that has been welcomed by the community and seems to be playing a role in the growing demand for Ethereum is Shanghai Hardfork, scheduled for the end of Q1 2023.
On other positive sides, Ethereum developers have announced the pre-launch of the Shanghai update on the Zhejiang testnet. According to a blog post published on February 10, the transition is necessary to allow withdrawals of locked sen staking amounts by validators.
The Zhejiang testnet is the first of three testnets that will implement the Shanghai upgrade. The Shanghai upgrade is expected to be launched in March, although no specific date has been given.
With Ethereum currently in a consolidation phase after the initial surge in January 2023, prices are trending horizontally between $1,500 and $1,700. Market dynamics and price action suggest that Ethereum (ETH) prices could break above the $1,700 level and head towards $1,800 and $2,000. However, a break below $1,500 could see Ethereum fall further to retest the $1,350 support.
Unless something significant happens in the market, sentiment and momentum favor buyers as the market gradually emerges from the crypto winter.