Why is the Ether (ETH) price up today?
Bitcoin 2024 conference in Nashville, as well as Donald Trump’s support for cryptocurrencies, contributed to ETH price rises. Ethereum’s native token, Ether $3,316, began well in the new weekly session, indicating a risk-on sentiment following Donald Trump’s significant crypto endorsement at the Bitcoin 2024 conference in Nashville and ahead of the Federal Reserve meeting.
Trump’s pro-crypto speech drives ETH price higher
On July 29, two days following Trump’s keynote address to the Bitcoin community in the United States, Ether’s price jumped 3.5% to around $3,400.
Trump proposed creating a $66,596 national strategic Bitcoin reserve, allowing the US government to keep 100% of any BTC held or acquired in the future. Later, Republican Senator Cynthia Lummis of Wyoming introduced legislation that calls for the US Treasury to acquire 1 million BTC over the next five years.
Trump’s pro-crypto views, as well as the possibility of a more favorable regulatory environment in the United States, have improved the prospects for widespread cryptocurrency adoption. Following his speech, Hong Kong Legislative Council Member Johnny Ng revealed plans to incorporate Bitcoin into the region’s financial reserves. These positive fundamentals propelled Bitcoin and the rest of the crypto market higher on July 27. When big cryptocurrencies, such as Bitcoin, receive encouraging news, the entire market, including Ether, typically rises.
Ethereum rises on improving rate cut bets
Ether’s price increase today comes before the Federal Reserve’s policy statement and Chair Jerome Powell’s speech on July 31, both of which are expected to support a September rate cut.
With the Fed’s benchmark rate hovering between 5.25% and 5.5%, policymakers have recently highlighted a balanced labor market and falling inflation, implying a justification for lower borrowing costs. Several experts, like former New York Fed President William Dudley and economist Mohamed El-Erian, advocate for more aggressive rate decreases, warning of potential policy errors if interest rates remain too high. The target rate probability of a September rate drop has increased to 87.7% from 57.9% a month earlier.
ETH funding rates reach June highs
Today’s Ether price rises coincide with Ethereum futures funding rates reaching levels last seen in June. As of July 29, Ether financing rates were 0.26% each week, up from a month-to-date low of 0.014% per week. Meanwhile, open interest fell to $13.97 billion on July 29, from a monthly high of $15.22 billion. A declining OI and rising funding rate coupled often indicate short covering. In other words, negative positions are being closed while bullish sentiment is rising, as indicated by long traders paying short traders to keep their positions open (resulting in higher funding rates). This combination can frequently foreshadow a positive price trend.
Ether bounces from key MA trendline
Looking at the charts, Ether’s price gains are part of a rebound that began at a support confluence formed by a 200-day exponential moving average (200-day EMA; the blue wave), a 0.236 Fibonacci retracement line, and the lower trendline of its prevailing descending channel pattern. The ETH price is presently approaching the channel’s top trendline at roughly $3,460, which coincides with the 0.5 Fib retracement line. A strong breakout above the channel is anticipated to propel the price toward the next fiber line at roughly $3,600.
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