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SEC Delays Ethereum ETFs For July 8 — ETH Price In Descending Channel

Published July 1, 2024 3:11 PM
Nikola Lazic
Published July 1, 2024 3:11 PM

Key Takeaways

  • Ethereum rose to $3,520 on July 1.
  • SEC delayed the ETH ETF decision to July 8.
  • Ethereum’s pivotal point is set at $3,700.

After falling to the $3,200 area on June 24, the price of Ethereum has been on the rise. Today, July 1, it reached a high of $3,520 to escape its descending channel. Meanwhile SEC has delayed its ETH Spot ETFs decisions scheduled today to July 8, further prolonging the uncertainty. 

With no major catalyst, can the ETH price continue to rise and make a decisive breakout above its month-long descending channel? 

SEC Returns S-1 Forms 

The launch of U.S. spot Ethereum ETFs, originally set for July 2, has been delayed. The SEC returned the S-1 forms with minor comments, requesting issuers to resubmit by July 8. This could push the launch to mid-July or later. SEC chief Gary Gensler indicated approval might come this summer. The SEC’s back-and-forth with issuers may continue, as this might not be the final filing.

The approval of the S-1 forms is the second phase in launching spot Ethereum ETFs. The first phase involved the 19b-4 forms, which the SEC approved in May.

Previously, in June, issuers updated their registration statements with sponsor fees and seed investments. For instance, Franklin Templeton disclosed a 0.19% sponsor fee and free trading for initial assets, while VanEck reported a 0.20% fee waiver for the first $1.5 billion assets. Additionally, issuers like Invesco Galaxy, Grayscale, Fidelity, and BlackRock revealed substantial seed investments to support their ETFs.

ETH Price Analysis 

Bullish Scenario 

Ethereum’s price surged from a descending trendline on May 17, escalating parabolically to nearly $4,000 by May 27—a 38% increase from its recent low of $2,870 on May 13. However, shortly after, it experienced a downturn, forming a descending channel to a low of $3,200 on June 24. 

ETH
ETHUSD | Credit: Nikola Lazic/Tradingview

As its May high came close to the previous one, two scenarios are ahead before this 18% downfall to June’s low. The daily chart above shows a bullish one, rising from May 13 as the first sub-wave of its larger wave 5. 

If this is the case, its next move should have greater momentum, pushing the price to a new all-time high of $5,100. With one more advancement left, Ethereum could go to $5,800 area before this wave five ends.

Bearish Scenario 

Alternatively, there is a bearish case in which the recent rise in May ended the major five-wave cycle from June 2022. If this is true, then the descending channel from May 27 will begin a major correction, being its wave A. 

ETH
ETHUSD | Credit: Nikola Lazic/Tradingview

Upon a corrective wave B to the $3,700 zone, we see a larger downturn eyeing lower values than May 1. If the C wave comes at the same length as wave A, the ETH price could be $3,000. But should it get extended to the 1.618 Fibonacci level, we can see ETH going to $2,600 to complete its C wave. 

Conclusion 

Ethereum’s ETF are undeniably coming, although the exact timeline remains uncertain. A major delay could potentially cause a temporary loss of interest, setting the stage for further downside movement. But since July 8 is only a week from now, in a positive outcome anticipation, we can see the price continuing to climb further.

The pivot point between these outlooks would be at $3,700. If the price continues to rise past this area, the likelihood of it heading to a new all-time high would increase. But if it gets rejected, it could mean ETH made its corrective B wave with a larger descending move yet to come. 

Disclaimer
Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.
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