Ethereum (ETH) Rallies Past $1,800 After U.S. Inflation Data Softens — Eyes on $2,400

Key Takeaways

• June’s U.S. CPI registered at 3.5%, undershooting market forecasts and providing support to digital assets
• Ethereum climbed more than 5% within a 24-hour period, surpassing the critical $1,800 threshold
• Approximately $300 million worth of short contracts were liquidated, with ETH representing over one-third of the total
• Crypto analyst Ali Charts highlights that the SuperTrend indicator has flipped bullish for ETH on the 3-day timeframe
• The 200-day EMA positioned near $2,200 represents the next significant hurdle, while $2,400 emerges as the extended objective

Ethereum has surged more than 5% over the past day following the release of June’s U.S. inflation figures, which arrived below market expectations.

Ethereum (ETH) Price

The Consumer Price Index (CPI) registered a 3.5% year-over-year increase for June. This figure came in 30 basis points beneath analyst projections. On a monthly basis, prices declined 0.4%, exceeding the 0.1% decrease that economists had anticipated.

Core inflation, which excludes volatile energy components, similarly retreated by 20 basis points. This development is significant as it reduces pressure on the Federal Reserve to pursue additional interest rate increases.

According to CME FedWatch data, the probability of no rate reduction in September climbed from 25% to 39% within a single trading session. Although 61% of market participants still anticipate a rate adjustment, the movement indicates a shifting macroeconomic environment.

Risk-on assets such as cryptocurrencies typically perform favorably when expectations for rate increases diminish. ETH emerged as one of Monday’s primary beneficiaries.

Massive Liquidation Event Impacts ETH Shorts

ETH pushed through the $1,800 mark — a critical resistance threshold — initiating a cascade of short position liquidations. According to CoinGlass data, approximately $300 million in short contracts were eliminated within a 24-hour window.

Source: Coinglass

ETH accounted for more than one-third of these liquidations, briefly surpassing Bitcoin. This reveals the substantial number of traders who had established bearish positions at that price point.

Analyst Ted Pillows observed that ETH had been maintaining ground above the $1,750 support area prior to the breakout. He emphasized that buyers were clearly defending that level, and as long as this foundation remained intact, the subsequent major movement would likely trend upward. That support zone held firm, and the anticipated move materialized.

Trading activity for ETH simultaneously increased by 33% during this timeframe. Elevated volume accompanying a price breakthrough is typically interpreted as a more robust confirmation than price action in isolation.

ETH had previously established a double bottom formation at $1,550. This level provided support on two separate occasions, and the rebound from it demonstrated significant strength. The $1,800 mark represented the neckline of this technical pattern — and ETH has now successfully broken above it.

Technical Indicators Point to Continued Strength

The daily Relative Strength Index (RSI) also displayed a bullish divergence preceding this rally. While price action was declining, selling momentum was weakening. This configuration frequently emerges ahead of trend reversals.

Cryptocurrency analyst Ali Charts identified another technical development during the same period. He observed that the SuperTrend indicator had recently flipped bullish on Ethereum’s 3-day chart. He emphasized that the previous two occurrences of this signal preceded ETH rallies of 72% and 177% respectively.

The 200-day exponential moving average (EMA) is currently positioned around $2,200. This represents the next critical level that bulls will be monitoring.

Should ETH successfully breach $2,200, the subsequent target becomes $2,400. This level coincides with a longer-term buy signal on the weekly timeframe, which triggered after the RSI fell beneath 30.

At the time of publication, ETH was changing hands around $1,850, reflecting a daily gain exceeding 5%.

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