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▲ Ethereum (ETH) and Bitcoin (BTC) ©Godasol
Amidst the geopolitical crisis between the U.S. and Iran, Ethereum (ETH), which demonstrated faster recovery resilience than Bitcoin (BTC), has defended key moving averages and embarked on an all-out challenge towards the $1,800 (USD) mark. Ethereum had been on a sluggish trend since 2026, but thanks to four consecutive days of capital inflow into Ethereum spot ETFs and a historic decrease in exchange holdings, it has firmly established downside rigidity. Market experts predict that with short-term chart recovery and a deepening supply shortage, breaking the psychological resistance level of $1,800 will be a critical turning point in determining whether it can stabilize at $1,830 and $2,000 in the future.
On July 9 (local time), according to the investment specialized media TradingNews, Ethereum stably maintained the $1,739 level during intraday trading, even amidst heightened Middle East risks such as Iran's retaliatory airstrikes. Unlike Bitcoin, which saw a concurrent decline and then stagnation during this crisis, Ethereum quickly recovered its losses, demonstrating its strength with a 5.7% weekly increase. Technically, it also surpassed both the 50-day Exponential Moving Average (EMA) of $1,708 and the 200-day Moving Average (DMA) of $1,693, which distinguishes a bull market, thereby completely escaping the bottom-level sell-off seen in June at $1,520.
This rebound is underpinned by improved supply and demand and positive changes in the regulatory environment. Ethereum spot ETFs are seeing increased buying interest, particularly around BlackRock's ETHA, with a net inflow of $26.9 million on July 7 alone. Furthermore, after the U.S. Securities and Exchange Commission (SEC) classified staking rewards as administrative actions in May, resolving legal uncertainties, interest-paying staking ETF products like BlackRock's ETHB have also become active. In addition, with 30% of the total supply locked in staking and Ethereum balances on exchanges falling to a multi-year low of 8.3%, the groundwork for a supply squeeze, where prices surge with capital inflow, has been laid.
However, unlike the short-term bullish momentum, a long-term value-capture problem remains. In terms of cumulative returns for 2026, while Bitcoin fell by 11%, Ethereum plummeted by 32%, causing the ETH/BTC ratio to retreat to a 10-month low of 0.027. This is because the mainnet transaction fees have sharply declined from $30 million daily to single-digit millions due to the Layer 2 (L2) scaling-focused roadmap, weakening the "ultra sound money" effect (deflation through EIP-1559 fee burning), which was a core investment thesis for Ethereum. The lack of demand from corporations like MicroStrategy to integrate large-scale balance sheet assets, unlike Bitcoin, and a high correlation of 0.78 with the Nasdaq 100 index are also contributing factors to the burden.
Accordingly, the market's attention is focused on the Q3 Glamsterdam upgrade, which aims to normalize value capture capabilities by significantly increasing the mainnet's processing capacity from 20 TPS to 10,000 TPS. While open interest in the derivatives market has seen some consolidation, the long/short ratio on major exchanges like Binance and OKX has exceeded 1.9, indicating that whales and professional traders are leaning towards a rebound. Although Citi recently lowered its 12-month price target to $2,240 due to slowing demand, the Relative Strength Index (RSI) points to stable momentum in the early 60s, and the Moving Average Convergence Divergence (MACD) is expanding into positive territory. Thus, a robust upward test is expected to continue as long as the $1,693-$1,708 support level is not breached.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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