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ETHUSD - Recovers Well to $160 as Hard Fork Looms



ETHUSD - Recovers Well to 160 as Hard Fork Looms
Ethereum (ETHUSD) has enjoyed its last few weeks and into the new year by moving very strongly from multi-year lows near $80 back up to around $160 in the last 24 hours. It has met some resistance at the latter level in the last couple of weeks which has seen Ethereum sold off a little. Given its momentum in its recent run, it wouldn’t surprise many to see it break through the resistance at $160 and threaten to return to the next potential significant level of $190. Ethereum enjoyed support from the $190 level for a couple of months before it broke down strongly through this level down to the multi-year lows close to $80.


After dropping sharply throughout July, Ethereum was desperately looking for any support from around the $250 level which had propped it up during the second half of August. Throughout the first half of August, Ethereum fell very sharply through any support at $400 down to then new 2018 lows. Ethereum was enjoying a reprieve from the heavy selling as it received some much-needed support from around $400 throughout July however that level now seems some distance away.

Throughout May and June, the cryptocurrency continued to decline strongly.  During a seven week stretch ETHUSD fell strongly losing almost 50% of its value in that short period, from the peak just over $800 in early May to the support level at $400.  Throughout April, ETHUSD again rallied well off support around $400 to the previous peak above $800, however these gains have been few and far between in 2018.   In January 2018, the price of Ethereum reached a new all-time high of $1,417.38, according to Coindesk, which represented a staggering 13000% over the prior 12 months.  To say that ETHUSD struggled during 2018 is an understatement. 

Ethereum (ETH) has yet again beaten Ripple (XRP) as the world’s 2nd leading cryptocurrency by market capitalization after spending several weeks in 3rd place.  Ethereum’s market cap reached approximately $15.8 billion, XRP’s market cap by almost $1 billion. However, the big news surrounding Ethereum presently is the upcoming hard fork which has been named 'Constantinople', which has been scheduled to take place on Wednesday 16th January 2019 at around 7 AM UTC.  The hardfork would decrease miners rewards from 3 ETH to 2 ETH but also decrease the block time, making the network faster. Although scheduled to take place a while back, the developers could not come into a consensus with the miners.  Alex Krüger, an economist and a cryptocurrency trader, pointed out in his analysis that in previous forks, Ethereum increased substantially in value. While the state of the market is significantly different than in previous instances, in consideration of the historical performance of ETH, the trader suggested that the Constantinople fork could contribute to the rise in the price of the asset.  The choice of name of the Ethereum fork, Constantinople, could be a little ominous, as that is the name of the capital of the Eastern Roman Empire after the Roman empire split. Ultimately that split led to a total collapse of the Roman Empire.

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