The price of Ethereum ($ETH
) is stuck in a consolidation phase, trading between $2,700 and $2,340 with no clear signs of a breakout. However, there are some optimists
Despite Ethereum's recent dip below the uptrend line, the historical pattern points to the possibility of a future rally. If ETH manages to hold key support levels, a bullish breakout could be just around the corner.
Ethereum: history repeats itself
CryptoBullet analyst recently noted that a bottom may be forming on the #ETH/BTC chart, reminiscent of a pattern from late 2016. Back then, Ethereum rose 2,738% over the following months. While such a jump is unlikely in today's market, this formation is encouraging for investors.
However, an ETH rally of 2,738% in the current environment would mean a breakout above $66,000, which is unrealistic. Nevertheless, even a fraction of such a rally could bring investors significant profits. If the ETH/BTC pair successfully forms a bottom, it could pave the way for sustained growth in the coming months, supported by strong market sentiment.
Ethereum's macro momentum also points to upside potential. The daily volume of profitable transactions on the network has consistently exceeded the volume of unprofitable transactions. This is indicative of Ethereum's underlying strength. A significant portion of ETH holders are in profit, which could support a bullish breakout from the current consolidation.
An increase in the volume of profitable transactions usually indicates bullish sentiment. This state of affairs can reinforce price resilience, especially if traders expect further gains. Positive momentum can help the price to break out of the current range.
ETH outlook: short-term targets
To break out of the consolidation, it is critical for the price to turn the $2700 level into support. Reaching this level will confirm the rebound from $2,546 and help ETH maintain the uptrend line built from September levels. A consolidation above these support levels would signal a strengthening of Ethereum.
If ETH successfully turns $2,700 into support, the next target will be $3,000. This is a realistic prediction compared to the more speculative gains seen in the past. Reaching the $3,000 mark could encourage more buying and extend the rally.
However, this bullish scenario could be canceled if the asset breaks uptrend support and falls to $2,344. Such a fall would increase bearish pressure and cast doubt on Ethereum's bullish short-term prospects.
