ETH/USD: Ether bulls eye $1500 after breakoutEther has risen to above $1400 this week, to reach its best level since early November. The recovery has coincided with other financial markets. In recent months, investors have been selling the dollar and piling into Chinese and European equities in particular. The ongoing optimism has lifted FTSE to its highest level since Aug 2018, as European indices continue to outperform their US counterparts.
Following another drop in US CPI on Thursday, investors have become even more confident that inflation has peaked and that the Fed and other central banks will stop their hiking soon. The peak inflation narrative was supported further by the University of Michigan’s closely watched inflation survey. This showed that consumers’ 1-year inflation expectations have now fallen to their lowest since April 2021. Surveyed consumers also reported an improvement in sentiment.
Investor sentiment has also been boosted by China re-opening its economy, which is why we continue to see the China A50, and other Chinese indices, push higher.
Until the dollar bottoms out or there’s another bearish macro stimulus, the path of least resistance would remain to the upside for cryptos and other risk assets in general. Thanks to the recent bullish price action, Bitcoin has risen well above $19K for first time since mid-December. Ether has risen to $1.4K, its best level since early November.
At the time of writing, ETH/USD was holding above its 200-day average after its breakout from its recent consolidation above $1350. For as long as any dips back to $1350 holds, the path of least resistance would remain to the upside. A move towards $1500 looks increasingly likely next.
By Fawad Razaqzada on behalf of FOREX.com
