Ethereum price weekly analysis 3 July: Solid gains backed by increased trading volumes
A week of recovery sees Ethereum gain over 7% as the market manages to outrun the bears.
- Ethereum is sitting at about $470 after a week of solid gains.
- Market bears tried to drag things down before the bulls responded with two solid price rises followed by consolidation.
- Stronger regulation and cooperation between regulators and exchanges is bringing institutional investors to the market.
After taking some losses over the weekend Ethereum has recovered nicely.
Starting the last seven days at $441 it traded in a band between $443 and $421 before being taken down by the market bears to just under $408. It sat around that level until Saturday when a big green candle was lit, boosting the price to almost $455. It then traded in a narrow band of between $444 and $456 before another green candle saw the price rise again. This time it hit the $475 mark.
Ethereum is currently sitting at about $470 and trading in a band between $468 and $483.
Trading volumes have mirrored the pricing moves with the price jumps occurring when buyers came to the market, boosting 24-hour trading volumes from about $1.2 billion to peaks of around $1.9 billion.
It's hard to know exactly what is behind the market's recovery over the past week or so. A look at the top 100 coins by market capitalisation reveals a lot of green – almost every coin has made gains this week with increases of over 20% not uncommon. Even in the more conservative top 10, half of those have posted gains in excess of 10%.
Perhaps one thing that is changing is increased participation by institutional investors. CCN reports the world’s biggest cryptocurrency exchange and brokerage Coinbase has launched its first crypto custodianship. This gives institutional investors and large-scale investment firms robust infrastructure and a storage platform and channel to invest in digital assets with more confidence.
Sam McIngvale from Coinbase told Bloomberg "We sort of have an understanding with the SEC and Finra, and it allows us to execute contracts with clients and take the first deposits".
I also expect that increased regulation of exchanges, such as the new rules imposed by AUSTRAC earlier this year in Australia, is giving cash-rich investors greater confidence to enter the world of cryptocurrency trading.
The numbers speak for themselves this week. If you've been trading Ethereum, or most other coins over the past seven days, you're likely to have made some gains. It's often said that bear markets are a great time to buy and perhaps the last week or so is a fulfilment of that trading maxim. We've seen buyers come back to the market and prices have been recovering. Traders that held their nerve, or had cash and bought when the market was at its lowest, will be either breathing a sigh of relief or smiling broadly this week.
Disclosure: At the time of writing, the author holds BTC, EOS, ETH, XLM, ETN, LTC, ADA and XRP.