Ethereum tested the $1,840 range resistance on Friday for the sixth time in two weeks.
We also saw the S&P 500 (SPX500) rally over 1% on Friday to close the month above a critical area between 4,070 and 4,090.
That could be significant for ETH, as crypto tends to follow US equities, and there seems to be a lag between the two markets.
Although I never fully trust end-of-quarter moves due to the volatility from institutions closing positions, Friday’s rally from equities could be a clue for Ethereum.
If the crypto market decides to follow equities higher in the next few days, we may finally get a bullish breakout from Ethereum.
However, a clean break above $1,840 resistance is critical.
The justification for a rally goes beyond what equities did on Friday.
A three-month lookback of ETH liquidations shows a significant cluster of short liquidations up to the $2,000 region.
That could be telling, as cryptocurrencies like to target these areas, and $2,030 is the August 2022 high.
Far more long liquidations are below current levels, but proximity matters, so the short liquidations up to $2,000 may influence ETH in the short term.
But I’d like to see crypto play “catch up” to equities sooner rather than later if this is to materialize.
If we don’t see ETH flush these shorts in the next few days, it’s less likely to occur.
And if ETH fails to hold above the $1,790 trend line below on an hourly and 4-hour basis, then all bets are off, and we probably see Ethereum trend lower toward $1,700 support.