Ethereum reclaims $1700 but struggles to hold on

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

• ETH’s recent pump waned and eased towards $1700 at press time. 
• Open Interest surged to $5 billion, last seen on 18 August, but later dipped.

After an impressive pump on 29 August, Ethereum [ETH] struggled to hold above $1700. The pump followed Grayscale’s win against SEC, but it appeared buyer exhaustion crept in. 

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Similarly, Bitcoin [BTC] faced rejection at $28k and struggled to hold above $27k. So, a BTC breach below $27k could complicate matters for ETH bulls. 

In a new development, on-chain data showed that ETH outperformed BTC on long-term holders by a whopping 40 million. The milestone was due to ETH’s many use cases. 

Will bulls defend $1700

Source: ETH/USDT on TradingView

ETH’s price dump around mid-August eased at a weekly bullish order (OB) of $1626 – $1770 (white). The 29 August pump led to a recent new high at $1745, flipping the higher timeframe market structure to a bullish bias. 

But the price rejection at the May lows set ETH to a retracement as of press time. If the $1700 cracks, ETH could depreciate towards $1640 or $1627 in the mid-term. But a further drop below the weekly bullish OB could make a retest of $ 1,500 feasible. 

On the upside, bulls could gain an edge if ETH pushes above $1745. If so, the next target could be $1800. 

Meanwhile, the RSI registered a downtick after climbing above 50, denoting buying pressure eased. Besides, the OBV has been making lower highs since mid-August, demonstrating a decline in demand over the same period. 

How much are 1,10,100 ETHs worth today? 

Open Interest eased

Source: Coinalyze

The price jump on 29 August led to an uptick in Open Interest rates that graced $5 billion, last seen on 18 August. But the metric eased below $5 billion as of press time, denoting a slight decline in demand in the derivatives segment. 

On the liquidation side, more longs ($2.1 million) were wrecked compared to shorts ($736k) in the last 24 hours before press time, Coinalyze data showed. The above insight could suggest $1745 being a sticky resistance in the mid-term.