Technical Analysis of ETH/USD for January 4, 2021

Crypto Industry News:

A new law filed on Thursday, HR9067, aims to create an office that will "coordinate" federal blockchain applications.

The project, sponsored by Darren Soto, a Democrat representing Florida's 9th arrondissement, would:

"(...) establish an office within the Department of Commerce to coordinate all non-defense deployment and blockchain activities in the federal government."

On December 31, the project was submitted to the House of Representatives for Energy and Trade. Although the text of the act has not yet been published, its originator may indicate the types of blockchain technology applications that such an office would try to "coordinate".

In recent months, Soto has proved to be an increasingly strong supporter of both cryptocurrencies, which he accepts as donations for campaigns, and blockchain technology in general.

Following news that the U.S. Post Office has filed a patent for a blockchain-based postal voting system, Blockchain co-chair Caucus said he hoped it would be used in the near future. Additionally, in September, Soto announced the culmination of "almost two years of pushing" his colleagues in the Energy and Trade Committee: the Digital Taxonomy Act, which will result in research into the use of blockchain technology in government. The creation of an office as described in HR9067 would likely lead to faster adoption and implementation of such technologies.

Soto's backing for cryptocurrency has been particularly strong lately. The Florida politician was also one of nine congressmen who rebuked the Treasury for allowing just over two weeks to comment on a new cryptocurrency monitoring rule. The rule has led to a call to arms across the cryptocurrency community, with some speculating that the Treasury may face a breach of procedure lawsuit.

Technical Market Outlook:

The ETH/USD pair has made new swing high at the level of $1,156.10 during the weekend. The up trend is being continued and there is no sign of trend reversal. Moreover, the up trend is now going parabolic and the next mid-term target for bulls is seen at the level of $1,420. The nearest technical support is seen at the level of $1,000. Please notice, the level of $1,000 is very close to the 161% Fibonacci extension level of the main wave 1, located at $1,047.

Weekly Pivot Points:

WR3 - $1,394

WR2 - $1,185

WR1 - $1,086

Weekly Pivot - $847

WS1 - $791

WS2 - $545

WS3 - $496

Trading Recommendations:

The up trend on the Ethereum continues and the next long term target for ETH/USD is seen at the level of $1,420, so any correction or local pull-back should be used to open the buy orders. Please notice, the up trend starting to go vertical, so the volatility will be higher than average. The bullish scenario is valid as long as the level of $830 is broken.

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