Background & News

Ethereum (ETH) has been the go-to platform for hundreds of ICOs in the past 2 years. While the crowdfunding market has been booming, Ethereum has suffered under scalability issues and load issues by popular dApps. The solution is near though, at least according to the developers of the platform, as the Constantinople hard fork will go live sometimes around October. The fork will smooth the transition from POW to POS and will also solve a good amount of scalability problems with it.

Another bullish news around Ethereum’s house is the recent news that the developers agreed to delay the ‘difficulty bomb’ and further reduce block rewards to 2 from 3 ETH per block in the upcoming hard fork.

Additionally CBOE just announced that it will launch futures for the biggest dApp platform to date, thus further validating its legitimacy. Even though the launch of CBOE and CME futures were the beginning of the bear market, this doesn’t mean that it will do the same for Ethereum as most cryptocurrencies (including Bitcoin) are down atleast 60-90% USD-wise from the top.

Could these news mean that Ethereum will turn into a bull market?

Charts

The ETH/BTC chart shows us that we are in a multi-month falling wedge that is getting increasingly narrow as we near the end. There was also a possible capitulation wick that bounced back above a historical support/resistance zone, while taking out a lot of stops. This could act as our bottom for now.

The increasing volumes coupled with the bullish divergence and the positive fundamental news leads us to believe that we might break out from the wedge shortly and could look at decent short/mid-term profits when longing the exact break.

The ETH/USD chart is slightly bullish, but can be considered almost neutral. There is a multi-month falling wedge in USD prices as well, with an exaggerated bullish divergence to be seen. The price is also in a previous accumulation/support range, but volumes are not convincing here (still better compared to a few weeks ago though).

We expect this chart to follow after the ETH/BTC chart and turn bullish soon enough.