After a surge in Ethereum (ETH) costs final week, the cryptocurrency may now be treading in a consolidation part, says asset administration agency IDEG’s chief funding officer.
In a report shared with Cointelegraph on Monday, the creator of the report, Markus Thielen stated he whereas he has been bullish on ETH costs six weeks in the past, he has now turned “cautious.”
The thesis has been based mostly on macro elements and worth evaluation of the cryptocurrency, noting that the Fed nonetheless continues to “ramp up its Quantitative Tightening (QT) program which drains liquidity,” whereas noting that ETH’s costs had reached technical resistance at round $1,800.
The asset administration agency additionally famous that this has come as Ethereum has seen a 47% drop in community income, a lower in complete quantity locked (TVL) and there was additionally a lower within the stablecoin market cap with USDC experiencing $1.1 billion of outflow over the past week.
Speaking to Cointelegraph on Tuesday, IDEG chief funding officer Markus Thielen famous that the latest worth rally has not been supported by a change in fundamentals.
Thielen additionally believes that hype across the “Ethereum Merge” is now experiencing a downward pattern, illustrated by latest Google search knowledge.
Source: “Ethereum Merge” Google tendencies outcomes: Google, IDEG Research.
Thielen advised that this “Merge fatigue” signifies that ETH is about for a consolidation interval previous to the upcoming Merge on September 19. But Thielen additionally added that this may open up doorways for extra shopping for alternatives:
“Ideally, a drop into the end of August would set us up for another great entry-level”.
Related: Pro merchants may use this ‘risk averse’ Ethereum choices technique to play the Merge
Thielen additionally commented on the attention-grabbing correlation between ETH worth and Ethereum Merge Google search outcomes that’s at present at play:
“It is a good indicator for sentiment and interest, but it will eventually break down and become irrelevant. Nevertheless, it might offer some insights into timing current Ethereum’s price change into the event”.
Following the Merge, Thielen is of the view that ETH worth might be largely influenced by how briskly adoption charges enhance:
“While gas fees might stay the same, the adoption curve might not rise initially as fast as many hope, this could make ETH slightly valued, when measured in pure cashflow terms”.
ETH is at present priced at $1,587 on the time of writing, down 6.24% over the past 24 hours.
