Ethereum (ETH/USD) lost an intraday 1.70% on Thursday after a Fed interest rate decision the previous day. The Fed raised rates by 75 basis points. The hike was largely expected, and potentially, the news was priced in the market. However, additional comments raised scepticism that saw most cryptocurrencies fall.
As the Fed continues to fight inflation, officials hinted at more moderate rate increases. The tone was slightly hawkish as investors had hoped the Fed would move slower in the wake of recession concerns. The comments were also not the most hawkish, as the idea of aggressive tightening wasn’t evident. The statement, however, meant that investors must brace for higher rates longer, which spooked markets.
The lower trading of ETH from an intraday high of above $1,600 underlined caution that gripped markets. As of press time, ETH was trading at $1,530 with weakening momentum.
ETH recovers slightly at the 61.8 retracement zone
Source – TradingView
Applying the Fibonacci retracement levels, Ethereum’s swing high lies at $1,663 and swing low of $1,158. The possible retracement levels are $1,227.99 (23.6%), $1,351.61 (38.2%), $1,411.11 (50%), and $1,470.61 (61.8%).
The price is showing some upside close to the 61.8% fib level. However, the momentum is weak, with the price showing little upside. The MACD indicator is bullish but also shows weakening momentum.
Which is the likely price level for ETH?
With the weak momentum, it is unlikely that ETH will recover at the current level. Although the price could recover at the 61.8% fib level, we consider the 50% fib more likely. The latter coincides with a support zone, making it a realistic target.
If ETH reaches the 50% fib level, buyers could look to buy around $1,400 to $1,450. Still, we cannot consider ETH price bearish as key level (s) remain intact.
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