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ETHUSD Market Update

3/14/2023 1:47 PM

Last week, against the backdrop of statements by the head of the US Federal Reserve, Jerome Powell, about his readiness to adjust the interest rate higher than investors expected, the ETH/USD pair renewed its January lows of 1369.75 but managed to win back the lost ground over the weekend, reaching 1700.00.

The positive dynamics were due to several reasons, the most important of which was the reaction of investors to the US government's measures to stop the financial crisis in the country after the bankruptcy of Silicon Valley Bank (SVB) and Signature Bank. The authorities said they would ensure the return of all funds of affected depositors, regardless of whether they were insured or not. Large crypto companies actively cooperated with the closed banks: thus, Paxos held 250.0M dollars in Signature Bank accounts, and Circle kept 3.3B dollars in reserves in SVB. Also, the regulator announced the launch of a 25.0B dollars Bank Term Financing Program (BTFP), which will provide financial institutions in trouble with access to short-term loans. Experts have already called this project "a new hidden quantitative easing," which marks a partial withdrawal of the regulator from the "hawkish" rhetoric. The provision of new volumes of liquidity at the expense of the US Federal Reserve aroused a serious interest among investors in risky assets, which led to the growth of alternative instruments to the dollar.

Additional support for the cryptocurrency sector was provided by the launch of CME Group Inc. a new type of futures contracts for BTC. They, like their counterparts, are calculated in fiat currency but they have daily expirations. Representatives of the exchange said that the new product will provide secure access to digital assets to an even greater number of investors, and on the first day alone, 550.0K such contracts appeared on the site.

The trading instrument is at 1700.00, the breakout of which will give the prospect of further growth to 1750.00 (Murrey level [8/8]) and 1812.50 (Murrey level [+1/8]). The key “bearish” level is the middle line of Bollinger bands around 1580.00, after consolidation below it, the price will be able to return to 1500.00 (Murrey level [4/8]) and 1375.00 (Murrey level [2/8]).

Technical indicators do not give a single signal: Bollinger bands reverse horizontally, the MACD histogram is preparing to enter the positive zone and form a buy signal, and Stochastic is pointing upwards but has entered the overbought zone.

Resistance levels: 1700.00, 1750.00, 1812.50. | Support levels: 1580.00, 1500.00, 1375.00.

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