ETH - MIXED SIGNALSThe Ethereum chart actually looks stellar, even in light of the expectations, which I will lay out below. Price is testing the center of the red range as support and Trading Alpha has sustained bullish dots. We had the breakout from the blue descending bull flag and a retest as support. All good.
But I have concerns.
It is hard to expect a good performance from the ETH ETFs to start, but this market tends to do exactly the opposite of what you expect.
The rationale is that we see a major sell off, like we did at the beginning with the Bitcoin ETFs. Why? Not because it is a "sell the news" event. The reason is... Grayscale.
When the BTC ETFs launched, GBTC fees were 1.5% - 5x the average competitor. Ridiculous. So we saw billions of dollars in immediate and sustained selling pressure, sending price from $49,000 to below $39,000... before going up to $74,000.
Grayscale set their fees for ETHE at an astounding 2.5%. ETHE has MUN:10B in AUM, which you can expect to largely be sold into the market. That is 10X the fees of BlackRock et al. ETH is a smaller asset than BTC, so this is a huge amount of potential selling pressure relative to the market. Am I bearish? No. Am I looking to potentially buy ETH much cheaper before demand kicks in? Yes.
It may not happen.
