VOT Research Desk
The high-stakes negotiations between China and the US have little bearing on the price of Ethereum.
Instead, the main force driving any movements in Ethereum this week will be the dollar’s spillover effect.
It shouldn’t come as a surprise that the modest increase this morning coincides with a weakening and further downside consolidation of the US dollar. Since the dollar is expected to weaken further as a result of the US inflation data coming in much lower than anticipated last week, the price action of ETH could be seen as taking advantage of this window of opportunity.
Expect the dollar to decline even further if some remarks made by FED members suggest that their rate hikes may slow down or even come to an end.
With a break above $1,300 initially and then a rebound toward $1,500 at the monthly pivot, this will give ETH price support.
The technical slide below the monthly S1 at $1,300, which has prevented price action from opening or closing above it since Saturday, poses a risk to the downside. This indicates that bears are pushing price action farther lower and may anticipate a squeeze toward $1,100.
That would go hand in hand with a stronger dollar and a retest of Wednesday’s lows, when the FTX implosion was at its worst.
