Ethereum network’s upcoming blockchain upgrade, the Shanghai hard fork could likely be a “sell-the-news” event or non-event.
Ethereum price hit a new yearly high at $1,911, a week ahead of the hard fork.
ETH price could retrace to support at $1,800 level, or plummet lower in the correction post the hard fork.
Ethereum hit a new yearly high as the price climbed above the $1,900 level for the first time in a year. ETH holders await the Shanghai hard fork scheduled for April 12 and a rally in the altcoin close to the event signals the likelihood of the upgrade being a “sell-the-news” event.
Ethereum price rallies ahead of Shanghai hard fork
Ethereum, the second-largest altcoin by market capitalization witnessed a spike in its price earlier today. ETH price climbed consistently since mid-December 2022, pushing the altcoin to a new yearly peak of $1,942, based on data from CoinMarketcap
The ETH holder community is waiting for the launch of the Shanghai and Capella upgrades, together known as the Shapella, on April 12. Given that the altcoin rallied in the week leading up to the event, it is likely that crypto market participants view the Shanghai hard fork as a “sell-the-news” event.
Ethereum exchange balance declines while non-exchange climbs
Based on data from crypto intelligence tracker Sentiment, when the largest Ethereum addresses are split into exchange v. non-exchange, their balances are moving in opposite directions. The Ethereum balance in the ten largest exchange addresses has hit all-time low levels while for non-exchanges, it has continued its climb, as seen in the chart below.
This signals accumulation by non-exchange players and a decline in selling pressure on Ethereum across crypto exchange platforms. A decline in selling pressure is a bullish sign for the altcoin's price.
What to expect from Ethereum price
Ethereum price has been in an ascending parallel channel since November 2022 with one significant break to the downside in March 2023. As seen in the price chart below, in the event of a decline, Ethereum price could nosedive to support at the $1,718 and $1,613 levels respectively.
If Ethereum price climbs consistently above the midpoint of the parallel channel, towards the 50% Fibonacci Retracement at $2,232, it could invalidate the bearish thesis. A decline below the lower trendline of the channel is expected in the event the Shanghai hard fork turns out to be a “sell-the-news” event.
