ETH Recovers From Drop, Analyst Points At 2021 Rally
Ethereum (ETH) fell below key support and hit its lowest price since November following Monday’s losses. Still, some market observers remain bullish, predicting significant gains for the cryptocurrency this quarter.
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Ethereum drops to two-month low
Ethereum starts the week with big changes correctfalling from a weekend range to its lowest price in two months. Over the weekend, Ethereum was hovering between $3,200 and $3,340 after recovering from last week’s lows.
Amid this performance, cryptocurrency analyst Ali Martinez tip Pointing out that the most critical resistance level for ETH is between $3,360 and $3,450, 4.37 million addresses purchased 6.47 million ETH. The analyst also noted that key support for the cryptocurrency lies in the $3,066 to $3,160 price range, with 4.12 million addresses purchasing 4.9 million ETH.
Ethereum tested this support area during the December correction and rebounded from this area after the pullback. However, the altcoin king fell below this key support level for the first time since November 9, hitting $2,920 on Monday.
After retracing 12% from weekend highs, ETH tested post-election breakout levels, confirming the $2,900 price range as support. Ethereum quickly rebounded from this level, surging 9% to the $3,100-3,200 range.
Cryptocurrency Investor Miky Bull consider ETH’s recent performance is a “perfect setup for a massive reversal.” The trader noted that this could be the reversal that leads to a breakout of Ethereum’s inverse head-and-shoulders pattern.
The second-largest cryptocurrency by market capitalization has formed an inverse head-and-shoulders pattern for several months, famous Several analysts believe that its left shoulder forms around the $2,800 price range.
Rekt Capital has said that “any pullback close to the $3,000 level could cause Ethereum to form a right shoulder.” Meanwhile, Miky Bull said bullish setups are targeting the $7,000 mark.
ETH Similar to 2021 Trajectory
Analyst Crypto Bullet pointed out that ETH’s chart is similar to 2021 ACT. The chart shows a double-top pattern during Ethereum’s rise more than three years ago. The cryptocurrency then fell below the key support area at $3,100, confirming the pattern.
However, after two weeks of consolidation, it returned to this level, causing ETH to break out to a new all-time high (ATH). The analyst said that Ethereum is repeating this pattern after yesterday’s decline, suggesting that the “worst case scenario” for the cryptocurrency will be to hit ATH levels again.
Daan Cryptocurrency Trader Highlight ETH’s historical performance at the beginning of the year, noting that “ETH’s performance in the first few weeks of the year was crazy.”
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CoinGlass CoinGlass data programme Ethereum’s weekly returns were mostly negative in the first few weeks of 2024, but as February approached, it began a 6-week streak of positive returns. This may indicate that ETH’s negative performance may be reversed in the coming weeks. Still, Daan recommends investors look at quarterly returns to get a better sense of seasonality.
At the time of writing, ETH is trading at $3,230, up 3% from the daily time period.
Featured image from Unsplash.com, chart from TradingView.com
