Ethereum price surges on ETF approval expectations

Bitcoin price edged higher on Tuesday, rising above the $43,500 level. If BTC price declines, further support can be found at $39,000, while resistance may be encountered near $44,000. 

Ethereum price surged on Tuesday, rising above the $2,380 level.  If Ethereum's price declines, it may encounter support near $2,170, while if it increases, resistance may be encountered near $2,400.

The approval of Bitcoin spot exchange-traded funds (ETFs) by the Securities and Exchange Commission (SEC) caused cryptocurrency prices to surge over the past few weeks. The SEC finally approved 11 applications but the enthusiasm over the approvals of Bitcoin spot ETFs is fading. Expectations of approval of Ethereum spot ETFs boosted Ethereum price on Tuesday. The SEC is not expected to decide on the fate of Ethereum spot ETFs before May, but a report by Standard Chartered Bank on Tuesday raised expectations of approval in the future.

The International Monetary Fund upgraded its global economic growth outlook on Tuesday, providing support for risk assets. The IMF raised its global growth forecast for 2024 to 3.1%, from 2.9% in October. The organization based its updated estimate mainly on increased economic growth in the US and China as well as on cooling inflationary pressures.

This week, all eyes will be on the US Federal Reserve and the monetary policy meeting on the 31st.  The Fed kept interest rates unchanged at its December meeting, within a target range of 5.25% to 5.50%. The US central bank is expected to leave interest rates unchanged again this week. 

Fed Chair Jerome Powell’s press conference after the meeting will attract much attention as traders will focus on the central bank’s forward guidance. Increases in central banks’ interest rates are putting pressure on risk assets. Markets are expecting a dovish pivot later this year, however, propping up crypto markets.

Markets are under pressure by increased risk-aversion sentiment caused by rising geopolitical tensions. Concerns that the Geopolitical crisis in the Gaza area may spread to neighboring countries drive risk sentiment down putting pressure on risk assets. The US and the UK have launched a coordinated action against Houthi rebels in Yemen. A drone attack on US forces in Jordan over the weekend intensified concerns that the crisis might spread to the Middle East.

BTC/USD 1h Chart

ETH/USD 1h Chart

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Written by:
Myrsini Giannouli

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