Ethereum (ETH) has witnessed a notable resurgence, reclaiming ground after hitting a crucial support level at $1,500. As traders analyze the daily time frame, it becomes evident that this resurgence may signify the formation of a bullish reversal pattern, known as a double bottom.
A double bottom is a classic technical analysis pattern that often signals a potential trend reversal. It consists of two troughs or valleys formed on a price chart. In this case, Ethereum touched the $1,500 support level twice, suggesting strong buying interest at this price point.
This pattern indicates that bears may have exhausted their selling pressure, and buyers are gaining control, potentially setting the stage for a bullish move.
ETH price movement in the last week. Source: Coingecko
As of the latest data available from CoinGecko, Ethereum is trading at $1,694. Over the past 24 hours, it has seen a gain of 3.7%, and over the past seven days, it has rallied by 8.3%. These recent gains are encouraging for ETH investors and traders alike.
ETH Key Resistance At $1,745 And Beyond
To confirm this recovery and set the stage for further gains, ETH needs to overcome a crucial resistance level at $1,745. A daily candle close above this resistance could trigger an additional 5.2% surge, which would challenge the neckline of the Double Bottom pattern.
According to recent price analysis, breaking above this neckline would provide a more solid confirmation of a sustained recovery and open the doors for a potential move towards the $2,000 mark, representing an increase of approximately 14.5%.
While the near-term outlook appears bullish for Ethereum, it’s imperative to keep an eye on the price action around the $1,745 resistance. The existing corrective trend will remain intact until Ethereum surges past its last swing high. If supply pressure surges at this resistance, the price may experience another setback, possibly leading to a continuation of the sideways trend.
ETHUSD trading at $1689.6 on the weekly chart: TradingView.com
A Deeper Descent?
In the event that buyers fail to overcome this hurdle, there is a chance that Ethereum could resume its southbound trajectory, possibly targeting the psychological level of $1,000. From its current position, such a descent would translate into a substantial 38% decline.
Ethereum’s recent price action and the emergence of the double bottom pattern offer a glimmer of hope for investors. However, the journey ahead is not without its challenges, primarily centered around the $1,745 resistance.
Traders and market participants should closely monitor these key levels and price developments as Ethereum navigates the path to potential recovery or further decline in the days ahead.
Featured image from Coinpedia