We have entered a new era for the largest Altcoin. Ethereum completed its transition to Proof-of-Stake on the 15th of September, and to a few people’s surprise, the price has been a non-event. However, there are a few things that should be noted, and it is likely Ethereum will face volatility going forward. In this article, we will analyze Ether’s immediate reaction and what to expect from the altcoin.
Ethereum 1-hour Chart Time frame
At the moment, the price of Ethereum has largely followed Bitcoin in the market. The directional bias remains bearish. At press time, Ethereum is currently moving between a bearish flag pattern, which may lead to a further drawdown near $1550. The range between $1580 and $1550 is currently a supply zone, which supports a bullish direction if it pans out.
During the merge completion, Ethereum did manage to reach immediate resistance at $1655, but the immediate correction altered the bullish scenario. The relative Strength Index indicator also suggested a neutral position between buying and selling pressure. Additionally, the 200-period Moving Average also remained a strong resistance just above $1655 i.e the resistance.
At the moment, it remains imperative for the bearish flag to indicate a direction. A breach above $1655, will propel Ethereum to a new bullish leg. While a drop below $1550 might trigger another drawdown period.
What Do the On-chain Metrics Suggest?
While many expected the price of Ethereum to jump in the markets right after the Merge, the non-event was largely expected as well. However, it did not stop from bringing attention to Ethereum. According to data, the Implied Volatility has risen. Rising Implied Volatility indicates that the future price action for an asset may be more volatile in the future. Keeping that in mind, price action is something that will be associated with Ethereum going forward.
Market Update
At press time, Ethereum’s price dropped after breaching past its bearish flag. It is currently retracing from the demand zone between $1420 and $1462. The asset is recovering but it is in a volatile state right now. As a result, the ideal market move would be to observe the asset over the next 24-48 hours.