ETH Target Remains $2,000 as Shapella Upgrade Date Nears

Key Insights:

On Wednesday, ethereum (ETH) fell by 2.82% to end the day at $1,657.
Silicon Valley Bank and Signature Bank contagion risk resurfaced, with the focus turning to Credit Suisse.
The technical indicators remained bullish, with $2,000 in view.

Ethereum (ETH) fell by 2.82% on Wednesday. Reversing a 1.37% gain from Tuesday, ETH ended the day at $1,657. Despite the bearish session, ETH revisited the $1,700 handle for the third consecutive session.
A mixed start to the day saw ETH rise to an early high of $1,723. Falling short of the First Major Resistance Level (R1) at $1,778, ETH declined to a late afternoon low of $1,614. ETH briefly fell through the First Major Support Level (S1) at $1,641 before wrapping up the day at $1,657.

Banking Sector Woes Overshadow Shanghai Upgrade News
On Wednesday, investor focus turned to the European banking sector. With the US government pledging to contain the fallout from the collapse of Silicon Valley Bank (SIVB) and Signature Bank (SBNY), Credit Suisse Group AG became the latest target as banks across Europe stumbled into the deep red.
Investors responded to Saudi National Bank news. Saudi National Bank stated it would not provide the Swiss bank with further financing. The lack of support from the bank’s largest shareholder left the Swiss National Bank to guarantee support if required.
Investor sentiment toward Fed monetary policy failed to deliver support, despite US economic indicators supporting a 25-basis point interest rate hike in March.
US wholesale inflation and retail sales figures failed to impress. The producer price index fell by 0.1% in February versus a forecasted 0.3% increase. Retail sales figures were more disappointing, falling by 0.4% in February versus a forecasted 0.3% decline. Retail sales jumped by 3.2% in January.
On Wednesday, the NASDAQ Composite Index rose by 0.05%, while the Dow and S&P 500 saw losses of 0.87% and 0.70%, respectively. The NASDAQ mini was up 66 points this morning.

ETH – NASDAQ Correlation 160323

Progress Toward the Shapella Upgrade Remains ETH-Positive
While banking sector woes weighed on ETH, continued progress toward the Shanghai hard fork was ETH-positive.
This week, the final round of testing took place, leaving Ethereum developers to announce the Shapella launch date. Developers will hold a call to agree on a launch date, which may be in early April.
Upon launch, stakers can withdraw staked ETH on the Beacon Chain, a feature of the heavily anticipated upgrade. As the Shapella launch nears, ETH staking inflows have resumed an upward trend.
According to CryptoQuant, ETH net staking inflows stood at 18,976 ETH on Wednesday. However, while up from 18,720 ETH on Tuesday, inflows are well below the 2023 high of 198,560.
A move to 20,000 levels would be ETH bullish. An upward trend in staking inflows would suggest net inflows rather than outflows once stakers can withdraw staked ETH.

ETH Staking Inflows 160323
The Day Ahead
Investors should continue to monitor the crypto news wires, with regulatory activity and US lawmaker chatter focal points. A quiet session would leave Shapella Upgrade details, Binance, FTX, and updates from the ongoing SEC v Ripple case to move the dial.
US economic indicators will also draw interest this afternoon. With bets of a 50-basis point Fed interest rate hike subsiding, weak stats could trigger US recession fears that would weigh on ETH and the broader crypto market.
Initial jobless claims and the Philly Fed Manufacturing Index will be in focus.
Away from the economic calendar, bank-related news will also need consideration. While governments and central banks may allow the orderly closure of regional banks, another Lehman event remains unlikely. Government and regulatory assurances should ease investor jitters.
Ethereum (ETH) Price Action
At the time of writing, ETH was down 0.53% to $1,648. A mixed start to the day saw ETH rise to an early high of $1,666 before falling to a low of $1,638.

ETHUSD 160323 Daily Chart
Technical Indicators
ETH needs to move through the $1,665 pivot to target the First Major Resistance Level (R1) at $1,715 and the Wednesday high of $1,723. A return to $1,700 would signal a bullish session. However, Shanghai upgrade news and the crypto news wires should be ETH-friendly to support a breakout.
In the event of an extended rally, the bulls would likely test the Second Major Resistance Level (R2) at $1,774 and resistance at $1,800. The Third Major Resistance Level (R3) sits at $1,883.
Failure to move through the pivot would leave the First Major Support Level (S1) at $1,606 in play. However, barring an event-fueled broad-based crypto market sell-off, ETH should avoid sub-$1,600 and the Second Major Support Level (S2) at $1,556. The Third Major Support Level (S3) sits at $1,447.

ETHUSD 160323 Hourly Chart
Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bullish signal. Ethereum sat above the 50-day EMA, currently at $1,600. The 50-day EMA pulled away from the 100-day EMA, with the 100-day EMA moving away from the 200-day EMA, delivering bullish signals.
A hold above S1 ($1,606) and the 50-day EMA ($1,600) would support a breakout from R1 ($1,715) to target R2 ($1,774) and $1,800. However, a fall through S1 ($1,606) and the 50-day EMA ($1,600) would give the bears a run at the 100-day ($1,589) and 200-day ($1,586) EMAs. A fall through the 50-day EMA would send a bearish signal.

ETHUSD 160323 4 Hourly Chart

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