Ethereum
Ethereum struggles to keep pace with crypto market rally despite positive US economic data
Ethereum struggles to keep pace with crypto market rally despite positive US economic data
On May 15, the cryptocurrency market saw its total capitalization increase by 5.5% following the release of data on inflation and retail sales in the United States. However, Ethereum (ETH) failed to take full advantage of this upward momentum. Bitcoin (BTC) price surged more than 7.5% in the past 24 hours to $66,190, outperforming Ethereum, which gained just 5% in the past 24 hours and has struggled to surpass the $3,000 resistance level.
The recovery in crypto markets has been largely driven by US macroeconomic data, particularly Consumer Price Index (CPI) data, which revealed an increase of 3.4% year-on-year in April, in line with market expectations. However, April retail sales data indicate stability from the previous month, contrary to economists’ forecasts of a 0.4% increase. This unexpected result increased the likelihood that the US Federal Reserve (Fed) would implement measures to stimulate the economy.
Some analysts believe that the expected decision by the US Securities and Exchange Commission (SEC) on May 23 on VanEck’s spot Ethereum ETF application is a key factor influencing Ethereum’s struggle to break above the resistance level of $3,000. Traders are hesitant to make investment decisions until the outcome of the SEC’s decision is more certain. A rejection from the SEC could lead to a short-term market correction, despite Ethereum’s promising long-term outlook.
Eric Balchunas, senior ETF analyst at Bloomberg, Express doubts whether an Ethereum spot ETF will be approved in 2024, given the SEC’s cautious approach to products that can be classified as securities, particularly those involving native staking services.
This skepticism is also reflected in the Ether derivatives markets. Currently, the Ether futures premium (base rate) stands at 9%, indicating a lack of enthusiasm regarding the spot ETF move and suggesting neutral sentiment among traders. In the options market, there is a balance in demand for call (buy) and put (sell) options, indicating uncertainty about the future price direction of Ethereum.