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ETH Faces the Risk of Sub-$1,600 on US Stats and Hawkish Fed Chatter

Cory Russell

Mar 03, 2023 14:16


On Wednesday, Ethereum (ETH) increased by 3.74%. ETH finished the day at $1,665, reversing a loss of 1.71% from Tuesday.

ETH dropped to an early bottom of $1,595 following a negative start to the day. While avoiding the First Significant Support Line (S1) at $1,585, ETH surged to a high of $1,670 in the early afternoon.

ETH quickly passed through the Second Major Resistance Level (R2) at $1,668 before relaxing back to finish the day at $1,665. ETH also broke through the First Major Resistance Level (R1) at $1,636.

Bitcoin (BTC) increased by 2.44% on Wednesday. Bitcoin finished the day at $23,707, reversing a drop of 1.53% from Tuesday. Bitcoin returned to the $24,000 mark for the first time in five days thanks to the positive session.

Bitcoin dropped to an early low of $23,036 after the day got off to a muddled start. Bitcoin climbed past the First Significant Support Line (S1) at $22,934 and reached a peak of $24,009 in the late morning. Before finishing the day at $23,707, Bitcoin momentarily passed through the Second Major Resistance Level (R2) at $23,823 and the First Major Resistance Level (R1) at $23,483.

Chinese economic data and the Shapella upgrade provide support

On Wednesday, the seamless Shapella update and mining influx helped to sustain the price of ETH. However, the Wednesday breakthrough was motivated by the world economic schedule.

On Wednesday, statistics from China provided support for risky commodities. The crucial Caixin Manufacturing PMI increased in February from 49.2 to 51.6. Analysts anticipated an increase to 50.2. An important development was the industrial sector's first expansion since July 2022.

The statistics were strong enough to overpower the impact of NASDAQ Composite Index and US economic data.

The ISM Manufacturing PMI survey's auxiliary variables backed up the more bearish outlook on Fed monetary policy. From 44.5 to 51.3, the ISM Factory Costs Index increased. The NASDAQ Composite Index was impacted by hawkish Fed talk as well. According to reports, Fed moderate Kashkari is willing to raise interest rates by 25 or 50 basis points in March.

Investors reacted negatively this morning to inflation data and bullish talk, sending Bitcoin and ETH into the red.