Ethereum (ETH) rose by 1.37% on Tuesday. Following a 5.65% rally on Monday, ETH ended the day at $1,705. Significantly, ETH last held onto the $1,700 handle on September 12, 2022. A choppy morning saw ETH fall to a mid-morning low of $1,651 before making a move.
Steering clear of the First Major Support Level (S1) at $1,601, ETH surged to a late afternoon high of $1,788. ETH broke through the First Major Resistance Level (R1) at $1,733 to test the Second Major Resistance Level (R2) at $1,784 before easing back to end the day at $1,705.
US CPI Report and Shift in Sentiment Toward Fed Policy Delivered Support
On Tuesday, the all-important US CPI Report delivered a breakout afternoon session. In February, the annual inflation rate softened from 6.4% to 6.0%, in line with forecasts. The softer headline figure supported a less aggressive Fed interest rate trajectory to bring inflation to target.
ETH responded to the CPI Report, rallying 3.65% to $1,747 within the first thirty minutes of the CPI Report. Easing Silicon Valley Bank (SIVB) and Signature Bank (SBNY) contagion jitters also contributed to the session gains. Investors responded further to White House and regulator assurances of containing the regional banking crisis.
On Tuesday, the NASDAQ Composite Index rallied by 2.14%, with the Dow and S&P 500 seeing gains of 1.06% and 1.65%, respectively. The NASDAQ mini was down 16.75 points this morning. As investors continue tracking the US bank-related, the Goerli testnet release drew interest on Tuesday. The release of the Goerli testnet brings Ethereum stakers closer to being able to withdraw staked crypto from the Beacon Chain.
While early progress in testing the Goerli Testnet was ETH price bearish, ETH staking inflows increased, with a more bullish ETH price outlook supporting higher inflows.
Ethereum (ETH) Price Action
At the time of writing, ETH was up 0.28% to $1,710. A mixed start to the day saw ETH fall to an early low of $1,686 before rising to a high of $1,723.
ETH needs to move through the $1,715 pivot to target the First Major Resistance Level (R1) at $1,778 and the Tuesday high of $1,788. A return to $1,750 would signal a bullish session. However, Shanghai upgrade news and the crypto news wires should be ETH-friendly to support a breakout.
In the event of an extended rally, the bulls would likely test the Second Major Resistance Level (R2) at $1,852. The Third Major Resistance Level (R3) sits at $1,989. Failure to move through the pivot would leave the First Major Support Level (S1) at $1,641 in play. However, barring a broad-based crypto market sell-off, ETH should avoid sub-$1,600 and the Second Major Support Level (S2) at $1,578. The Third Major Support Level (S3) sits at $1,441.