ETH price: CoinShares’ chief strategist points to “buy the rumour sell the news’ outlook

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ethereum cryptocurrency coin on table

Meltem Demirors, the Chief Strategy Officer at digital asset management firm CoinShares, says there isn’t much new capital currently getting into the Ethereum market.

The CoinShares executive noted this dueing an interview with CNBC’s ‘Squawk Box’ on Monday.

According to her, while has been a lot of positivity around the “Merge”, the broader market is still jittery over over inflation and other macro-side of things. It’s a situation likely to see the highly anticipated event not be the sole driver of price action, she said.

Her comments come as Ethereum (ETH/USD) dropped below $1,600 on Monday. The cryptocurrency’s price has broken lower alongside most of the crypto market, including Bitcoin (BTC/USD), amid sell-off pressure in the risk-on asset market.

But while bulls are attempting to break back above the crucial level for Ether, the coin’s current price of $1,584 leaves it nearly 19% off its seven day high. The losses have wiped off the gains seen following news of the upcoming upgrade, when Ethereum is to fully transition to the proof-of-stake consensus mechanism.

Is the ‘merge’ sentiment over?

Although hailed as a bullish factor, the current outlook appears to conform to a classic “buy the rumour, sell the news” scenario for the native ETH token, Demirors said.

This past week has seen Ethereum price struggle, even as some analysts suggest the ‘merge’ remains one of the biggest catalysts for an upward movement.

She told Squawk Box that enthusiasm aside, market players are actually looking at the upgrade as a single event – in isolation of the broader market outlook.

“While internally there’s a lot of enthusiasm within the crypto community and Ethereum community around the Merge as an event that will dramatically reduce supply while potentially driving demand, one of the realities is on the macro side, people are worried about rates, about macro.”

According to her, these aspects, and the fact that the broader market has a confluence of potential price drivers, suggest that ETH might struggle amid the ‘merge hype’.

Summing up the outlook for Ethereum, she explained:

“I don’t think there’s a lot of new capital coming in to buy Ethereum on these changed fundamentals and technicals. There’s also some risk that I think will need to play out with the market. So in my view, the Merge has been a ‘buy the rumour and sell the news’ situation.” 

She also suggests most of the market activity is currently through trading ETH options and not through direct exposure.

The post ETH price: CoinShares’ chief strategist points to “buy the rumour sell the news’ outlook appeared first on Invezz.

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