5 September 2024
Ethereum is trading near its yearly low of $2,400 after an 18% drop from local highs. ETH has notably underperformed compared to Bitcoin and other altcoins like Solana this cycle, leading to investor concerns.
One of the key reasons for this underperformance is the lack of enthusiasm surrounding Ethereum ETFs. Metrics from these funds show low interest from traditional investors, adding to the bearish sentiment around ETH.
As the crypto market is gripped by fear and uncertainty, Ethereum traders are searching for clues on whether a potential recovery is on the horizon. Top analysts and investors have started sharing their views on ETH’s next move, with many suggesting that a bounce could occur if certain technical levels hold. If this bounce materializes, it may relieve Ethereum, but until then, the market remains cautious.
Ethereum Price Action Suggests A Bounce
Ethereum is currently trading at a critical level that could propel the next big move if it holds support. Top analyst and investor Mags has shared an analysis on X, revealing that ETH has been consolidating within a massive triangle formation since 2021.
According to Mags, Ethereum is now approaching the lower boundary of this formation, which is a crucial support level that could define its next significant move. Mags anticipates a potential double-bottom pattern forming near this upward-sloping trendline, indicating that a bullish reversal may be on the horizon.
Recently, the price tested a key demand zone at $2,307, showing initial signs of recovery. This level is essential for Ethereum’s price action, as a hold above it could signal strength and create the foundation for a move higher.
The analysis suggests that the next target for ETH could be new all-time highs if it breaks out of the triangle pattern, defying the bearish expectations of many traders still waiting for lower prices.
This potential bullish scenario could unfold if Ethereum’s price holds the lower boundary of the triangle and gains upward momentum. A breakout would send ETH toward higher levels, outperforming current market sentiment and surprising investors.
ETH Holding Above $2,300
Ethereum (ETH) currently trades at $2,396 following intense volatility and market uncertainty. The price is in a consolidation phase, which could still be susceptible to a surprising retrace if demand weakens further. Currently, ETH is trading below the 4-hour 200 moving average (MA) at $2,596, aligning with the crucial $2,600 level.
This level is vital for ETH to retake if it aims to push higher in the short term. A sustained trading position below these levels signals weakness and the potential for further declines.
For bulls, reclaiming the $2,600 mark is essential to shift the price structure and initiate a new uptrend. Success in pushing this level could set the stage for targeting the local high of $2,820.
However, if ETH fails to close above $2,600, the next significant support is anticipated around $2,116. The price action in the coming days will be critical in determining ETH’s next move, with traders watching closely for signals of either a breakout or a deeper retrace.
Featured image from Dall-E, chart from TradingView