Ethereum Drifting as Istanbul Update Closes — Price Analysis

The next hard fork of Ethereum (ETH), “Istanbul,” is scheduled to go live this weekend, and the response from the market so far has been zilch. ETH has continued to meander mostly sideways on its Bitcoin pairing, after having dropped sharply with Bitcoin on its USD pairing.

We can begin with the daily ETH/Bitcoin pairing, where we see that Ethereum is on its way to retesting a support band for the third time since September. This would be a risky event, as supports often break after repeated testing. What’s more, we see that ETH recently lost a chance to continue consolidating up, toward the 2017 “capitulation level” – where price entered territory not seen since 2017.

Risking another test of supportETH chart by TradingView

The histogram looks here like it could begin expanding to the downside again, although it is too soon to say.

Moving to a 3-day ETH/USD chart, we see that Ethereum is now well within the market structure of the 2018 bear market bottom, from a year ago. There are not many supports left to cling to in this structure, which briefly went into double digits last year. Volume at the moment is generally low, after expending itself mid-year during the periods of gain.

Not many levels left to testETH chart by TradingView

On the EHT/USD daily chart, we actually see a promising movement on the histogram, with the beginnings of a gently expanding (bearish) profile seeming to reverse yesterday up and through to the positive side.

Histogram reversal? We'll seeETH chart by TradingView

We would have to see this translate into a daily close or two above the 8 EMA, for starters. Volume is dead at the moment on Coinbase, while the RSI is neutrally pegged to price.

All in all, we are still waiting for a bottom on the king of altcoins. The low volume suggests the end of a consolidating period may come soon. The bullish and bearish signs are pretty much equal, making it a wildcard scenario heading into the weekend hard fork. After a 63% correction from the 2019 top, though, one wonders how much further ETH can go.

The views and opinions expressed here do not reflect those of and do not constitute financial advice. Always do your own research.

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Attacker Exploits Defi Protocol to Make $360,000 in a Single Transaction

Francisco Memoria

Ab attacker has managed to exploit the decentralized finance (DeFi) protocol bZx to make over $360,000 worth of profit in a single transaction through what’s known as flash loan.

Using a decentralized trading platform dYdX, a hacker borrowed 10,000 ETH, currently worth around $2.5 million, and then sent half of it to decentralized finance lending platform Compound, and half to decentralized trading platform bZx.

Using the funds on Compound, it borrowed 112 wrapped bitcoin tokens (wBTC), ERC-20 tokens backed 1:1 by bitcoin. Using the half on bZx, the hacker entered a short position for 112 wBTC. He then sent the 112 wBTC it got from Compound to another trading platform, Uniswap, in a move that lowered the price of the tokens which made the short sale profitable.

The hacker then repaid his loan to dYdX and kept the profit from the short sale, 1,300 ether that were then worth $360,000. All of this was made in a single transaction that cost around $8 worth of transaction fees.

single transactionSource: Etherscan

The attack was pulled in a single transaction through what’s known as a flash loan. Essentially, the attacker borrowed 10,000 ETH without any collateral as he borrowed the funds in the same transition that paid them back. Through a smart contract, it was possible to pull the transaction.

Using the exploit, the hacker made over 1,000 ETH in profit and cost the bZx protocol over $620,000 in equity. bZx has made it clear users won’t suffer from the loss as it will compensate them. Those behind the project are set to release a detailed analysis at 5pm MST.

Data from DeFi Pulse shows that investors quickly started withdrawing from bZx right after the incident occurred, but started regaining confidence as soon as the project addressed the issue and clarified they wouldn’t be socializing the loss.

Featured image via Pixabay.