Ethereum remains stuck in a tight range as US CPI looms. What are the key levels to watch?

FUNDAMENTAL OVERVIEW   Similar to Bitcoin, Ethereum had a volatile end to last week. On Thursday, the price spiked to the upside after some dovish Fed’s Waller comments indicated that he would be willing to keep interest rate unchanged at the September meeting barring hot CPI data. Since he deviated from his usual hawkish stance, it triggered a dovish repricing in interest rate expectations which lowered the probabilities for a September rate hike and gave Ethereum a boost. On Friday, most of the Waller-driven gains were erased after the US NFPsurprised to the upside showing job growth in August almost tripling the consensus estimate of 56K. This triggered a hawkish repricing which saw the probabilities for a rate hike in September returning to pre-Waller levels. This week, all eyes will be on the US CPI report data. Unless, we get some surprising breakthrough in US-Iran relations, the price action will likely remain mostly rangebound or a bit negative as traders at some point might start hedging into the CPI release. A soft or in-line CPI will likely give Ethereum a boost as Fed’s Waller mentioned that he won’t consider a rate hike unless we get a hot CPI. Conversely, an upside surprise in core monthly inflation data will likely trigger another selloff as traders will position for a rate hike.   ETHEREUM TECHNICAL ANALYSIS – DAILY TIMEFRAME On the daily chart, we can see that Ethereum is still stuck in a tight range between the 2,360 support and the 2,560 resistance. If the price breaks to the downside, we can expect the sellers to pile in to target a drop into the major trendline around the 2,100 level. The buyers, on the other hand, will want to see the price breaking higher to increase the bullish bets into the 3,400 level next. ETHEREUM TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME On the 4 hour chart, we can see more clearly the rangebound price action. I also marked the four major catalysts that kept Ethereum volatile in the past few weeks. As we wait for the US CPI release, the market participants will likely continue to play the range by buying at support and selling at resistance until we get a breakout on either side. ETHEREUM TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME On the 1 hour chart, there’s not much we add here as a breakout of the range would be more important than the choppy price action inside it. Moreover, the two main themes at the moment are the US-Iran war and the volatility in Fed rate hike expectations. Therefore, traders would be better off waiting for the US CPI, some surprising breakthrough in US-Iran relations or a technical breakout for the next major move. UPCOMING CATALYSTS Tomorrow, we get the US PPI report and the US Jobless Claims figures. On Friday, we conclude the week with the US CPI report. This article was written by Giuseppe Dellamotta at investinglive.com.