- Ethereum price made a strong rebound on Thursday.
- It rallied after the weak American inflation data.
- Ethereum DEXes could benefit from the FTX crash.
Ethereum price staged a strong recovery on Thursday after the US published encouraging consumer inflation data. ETH soared to a high of $1,313, which was about 22% above the lowest level this week. Other top coins like dYdX, Bitcoin, Band Protocol, and Phala Network also jumped sharply.
US inflation data
Ethereum price surged as investors reacted to the latest American inflation data. According to the Bureau of Labor Statistics (BLS), the headline consumer inflation crashed from 8.2% in September to 7.7% in October. This decline was bigger than the median estimate of 8.0%.
Core inflation, which excludes the volatile food and energy prices, declined from 6.6% to 6.3%. These numbers are positive for Ethereum and other cryptocurrencies because they signal that the Federal Reserve will likely slow its rate hikes in the coming months.
Analysts expect that the bank will hike rates by 0.50% in its December and then shift to smaller 0.25% hikes in the coming year.
Ethereum price remains significantly lower from its highest level this month because of the collapse of FTX. Investors believe that the industry will continue struggling as contagion risks remain.
Find out how to buy Ethereum.
However, there is a silver lining to the crash of FTX. For one, the collapse of FTX, Voyager Digital, Celsius, BlockFi, and Vauld has shown the limits of centralized exchanges. In this period, we have not seen a major collapse of a leading decentralized exchange (DEX)
Proponents of DEX cite their transparency and the fact that decisions are made collectively through a vote. Also, they are usually open source, meaning that anyone can see the happenings behind the scenes.
Therefore, there is a likelihood that many people will shift to DEX platforms. If this happens, Ethereum will likely benefit since it hosts some of the biggest DEXes like dYdX and Uniswap.
Ethereum price prediction
The 4H chart shows that ETH price has made a strong rebound after the latest American inflation data. It managed to move above the important resistance at $1,236. The coin remains below all moving averages while the Stochastic Oscillator has moved above the oversold level.
Therefore, there is a likelihood that ETH price will continue rising as buyers target the next key resistance at $1,500. The alternative scenario is that this could be a dead-cat bounce, which will see the coin pullback in the near term.
