Ethereum shows potential for a bullish reversal with an inverse head and shoulders pattern. Predictions suggest price targets could reach between $8,000 to $20,000 if critical resistance is cleared. Currently, ETH sits at approximately $1,804, with key support levels at $1,750 and $1,400 depending on market movement.
Ethereum is currently showing signs of a potential bullish reversal, characterised by a significant inverse head and shoulders pattern observed on its weekly chart. This technical formation suggests that ETH could be on the cusp of a breakout. Analysts are optimistic, with predictions ranging from $8,000 to even $20,000 in the longer run, especially if key resistance levels are surpassed. Currently, Ethereum hovers around $1,804, following a period of sluggish price action due to heavy selling pressure.
The inverse head and shoulders structure, which has emerged during the last few years, is a classic bullish indicator. The left shoulder formed amid the mid-2021 market correction, while the head came into play during the market dip in mid-2022. Now, the right shoulder is unfolding, having bounced back from recent lows close to $1,750. As ETH gradually pushes towards critical resistance levels around $1,820 to $1,850, which aligns with the 23.6% Fibonacci retracement, a breakout could amplify bullish momentum.
Despite a somewhat subdued weekly Relative Strength Index (RSI) at 37.72, which indicates that ETH isn’t yet in the overbought zone, there’s still potential for upward movement. Furthermore, even though the MACD is currently bearish—showing a MACD line at -283.55 against a signal line at -369.40—the histogram suggests that selling pressure is easing, which may lead to a bullish crossover if the price continues to rise.
The scenario for a potential breakout is clear: the measurement derived from the bottom up to the neckline of this pattern suggests that Ethereum’s price could potentially double or triple from its present level. If the market sentiment turns positive, driven by factors such as ETF approvals and heightened institutional interest, ETH might set its sights on the aspirational $20,000 mark. However, until a breakout occurs, it is likely to remain trapped within a broader consolidation range from $1,750 to $2,000.
Analysts, including Van Lagen, foresee the immediate price targets for Ethereum resting at key resistance points of $2,876, $3,821, and the previous all-time high around $4,881. A breakthrough past the important neckline near $3,800 could propel ETH into the higher ranges of $8,000 to $10,000, with $20,000 being the long-term objective.
Interestingly, on-chain data indicate increased whale activity in the Ethereum market, which might reflect growing confidence in ETH’s future potential. This trend could be a precursor to a bullish phase, but it’s essential for investors to monitor the upcoming support levels around $1,750 and $1,400 in case of a market downturn.
