Tomorrow marks a significant day for Ethereum as eight spot Ethereum ETFs from Grayscale, Fidelity, Invesco, VanEck, Franklin Templeton, 21Shares, Bitwise, and iShares (BlackRock) are set to start trading.
Here’s what to expect from the stock and crypto markets once they go live:
Analysts anticipate that these ETFs might impact ETH’s price more substantially than Bitcoin’s equivalent due to Ethereum’s lower inflation rate, reduced staking costs, and the fact that 28% of ETH is staked.
Initial predictions suggest a modest price increase for ETH, but as investors shift from Grayscale’s ETH trust, there could be a “sell the news” event. Nevertheless, new highs could still be achievable by year-end.
Currently, Ether is trading at $3,439, down slightly by 0.64%, showing consolidation within a narrow range, indicating traders are waiting for the ETF launch.
Key resistance levels to watch include $3,641, $3,768, $3,895, and $3,974.
If bullish momentum builds, breaking these levels could push the price past $4,000. Short-term support is indicated by the Ichimoku cloud at $3,499 and the TEMA (9) at $3,457.
Maintaining these levels could signal a bullish continuation, but a drop below might lead to prolonged consolidation. The RSI divergence value of -9.63 points to a potential bearish move or correction.
Similar to the outflow seen with Grayscale’s BTC ETF during its conversion, the Ether ETF might face the same issue.
Grayscale’s ETH ETF has a higher management fee of 2.5% compared to the typical 0.2% for other ETFs, which could result in significant selling pressure.
This could potentially push Ether’s price below $3,000 for the first time in many months. QCP Capital commented:
“The lack of positive reaction is a negative reaction. Right now, the market seems to be seeing who folds first to ‘sell the news’.”
Increased volatility is expected throughout the week, with anticipation already causing implied volatility in ETH options to jump from 56% to 70%, indicating the market is preparing for a turbulent period.
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