Ethereum’s recent price action has raised intriguing possibilities for both bullish and bearish scenarios, sparking interest among investors. After attempting to break a crucial resistance level, Ethereum was ultimately rejected, bringing fresh attention to the potential price patterns and key support points. Let’s dive into the recent technical insights.
Failed Breakout and Shift in Pattern
In a recent analysis, Ethereum’s price attempted to break above a critical green line, which many traders hoped would confirm a bullish move. However, this move was short-lived, and Ethereum’s price was pushed back. The rejection invalidated the anticipated triangle pattern in the short-term bearish count. While disappointing to some, this doesn’t entirely change the trajectory for Ethereum’s price. The structure may simply be shifting from a triangle pattern to a WXY formation, keeping a near-term bullish potential alive.
Aiming for Confirmation at 3,400
For Ethereum to solidify a bullish move, the cryptocurrency would need to reach the 3,400 level through a five-wave sequence, indicating that the recent low set on August 5 could indeed be a market bottom. Currently, Ethereum has only completed three of these five waves, leaving two waves still necessary to confirm an upward trend. Reaching this level would signal a stronger foothold for further gains.
Diagonal Pattern and Complex Moves Ahead
Ethereum’s larger price trend since 2020 has taken the shape of a diagonal pattern, a complex structure where prices rise gradually rather than in straightforward upward thrusts. The recent rise from August lows could form part of an ABC structure, often marked by corrections rather than clear advances. This complex setup could mean Ethereum’s journey to higher highs will be a bumpy one, with frequent corrective phases that make precise trading challenging.
Bearish Possibility Still Lingers
However, Ethereum’s price movement could also represent a WX-Y structure, with the final Y wave still unfolding. Under this interpretation, there’s still room for one more price high, but the overall structure remains fragile. This bearish outlook remains possible, with the potential for additional correction if Ethereum fails to hold support at key levels.
Key Support Level: 2,541
Currently, the critical pivot point is 2,541, which acts as a decisive support level. Holding above this level could pave the way for an upward push, potentially setting Ethereum on track toward 3,400. However, a break below may suggest a bearish shift, with the next support level at 1,800.
Ethereum’s price remains delicately poised, with both bullish and bearish outcomes still in play. Investors should keep a close eye on the 2,541 level as a near-term indicator of Ethereum’s likely trajectory.
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