Why Did the Rally on Ethereum Stop? Expert Analyst Predicted the Situation of Bitcoin and ETH in the Coming Days

David Duong, head of research at Coinbase Institutional, stated that the recent rise in Ethereum’s (ETH) is based on technical factors, but investors’ willingness to allocate capital is still limited.

In a statement made via social media, Duong said, “Last week’s rise of ETH was largely based on technical reasons. This was related to the excess of mismatched positions, short position closures, and subsequently the reopening of positions. This wave of rise is actually a movement for ETH to catch up with its peers like BTC and SOL.”

Duong stated that this recovery in ETH prices does not mean a general appetite for capital allocation in the market: “Such price movements do not indicate that the market is willing to allocate ETH on a large scale; demand is still limited.”

On the other hand, Duong painted a positive picture in his comments about Bitcoin: “BTC is on the rise and its dominance may continue to increase.” From a macroeconomic perspective, Duong stated that the easing of trade relations between the US and China has increased investor sentiment in the last week. Notably, he pointed out that the $600 billion trade agreement between the US and Saudi Arabia has reinforced this optimism, indicating that it has pushed recession expectations in the US to the background this year.

However, according to Duong, things are more complicated on the Japan side. The upper house elections scheduled for July in the country may harden Tokyo’s stance, despite earlier statements about reaching a trade agreement by June.