Ether Prices Climbed More Than 10% In Roughly 24 Hours
Ether prices have bounced back recently, recovering after they followed many different assets lower yesterday.
The digital currency, which is the second-largest in terms of total market value, reached $1,342.70 close to 9 a.m. EDT, according to CoinDesk data.
After rising to this level, it had appreciated 10.25% since approximately the same the day before, additional CoinDesk figures reveal.
Since then, the cryptocurrency had pulled back slightly, but it has still managed to retain most of its recent gains, trading close to $1,300 at the time of this writing.[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
Ether pushed higher during a period when many risk assets, including stocks and cryptocurrencies, enjoyed gains.
When seeking to explain the latest increases in the value of this digital currency, analysts offered differing takes.
Traders Buying The Dip
Some emphasized the opportunism of traders, claiming that they sought to buy the dip after asset values declined.
“We saw quite big up- and down-swings at the stock markets this week which are also followed by crypto market prices,” said Marc Bernegger, cofounder of crypto fund of funds AltAlpha Digital.
“Many short term oriented traders are taking advantage of these swings unrelated to the long term perspectives,” he stated.
Andrew Rossow, internet attorney & Web3 advisor, provided a similar perspective.
He described ether’s latest gains as being a “combination of traders capitalizing” and “also some of the success we are seeing from some of these NFT projects that are thriving in the current bear market.”
“I think there is still a level of confidence right now for investors to tastefully align themselves with certain NFT ecosystems that may also explain this behavior,” said Rossow.
Other analysts pointed to the key role played by important macro trends, for example the latest inflation data and its expected impact on Federal Reserve policy, as helping drive ether’s recent price fluctuations.
Yesterday, the U.S. Bureau of Labor Statistics reported that the Consumer Price Index for All Urban Consumers, a headline measure of inflation, increased 8.2% during the 12 months through September.
This figure was slightly less than the 8.3% increase that this measure experienced in the 12 months through August.
Brett Sifling, an investment advisor for Gerber Kawasaki Wealth & Investment Management, commented on how these broader trends have been impacting ether.
“I believe a lot of the same macro trends (inflation and the Fed) are affecting Ethereum’s price action just like it’s affecting Bitcoin,” he stated.
“With the sell off yesterday caused by concerns in the inflation report, Ethereum temporarily broke it’s recent support at the ~$1250 level,” Sifling added, pointing out a key technical level.
“When the equity markets recovered throughout the day, this speculation likely split over to risk-on assets like crypto and could have caused the sharp rally,” he asserted.
Crypto Market Consolidation
One analyst supplied a completely different interpretation of ether’s recent price movements, describing them as amounting to volatility that is expected to happen as many digital assets move within a specific range.
“Most of the market, including Ethereum, has been trading sideways for at least a month, and it looks like we’re still in that consolidating stage,” said Marouane Garcon, cofounder of cross-chain decentralized exchange WhaleSwap.
“So, within range, there will continue to be small ups and downs in the near future,” he noted.
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether, EOS and sol.