With a potential double-bottom reversal in play, could Ethereum price break out of its wedge pattern and surge toward the $4,000 mark?
Amid increased volatility in the crypto market, Ethereum briefly retests the $3,000 level. As it shows signs of a fresh intraday recovery, bulls are presenting solid reversal opportunities. Will this reversal rally push Ethereum past its local resistance trendline for a breakout?
Ethereum Price Analysis Hints at Breakout Potential
On the 4-hour chart, Ethereum’s price trend shows a bullish failure to sustain above the $3,200 level. This led to a retest of the $3,000 level, with the 24-hour low at $3,039. However, the recent recovery has driven the price to $3,143.
Along with the recovery, the price trend highlights a potential double-bottom reversal from the psychological support level. Additionally, the double-bottom pattern is accompanied by a bullish divergence in the 4-hour RSI, further increasing the likelihood of an upside continuation.
Ethereum Derivatives Market: Mixed Signals
Amid the growing volatility, speculations in the derivatives market are also on the increase. Ethereum’s Open Interest has decreased by 1.92%, standing at $30.40 billion, but the funding rate remains stable at 0.0076%.
Ethereum Derivatives
Ethereum ETFs Register Net-Zero Flow
As Ethereum derivatives give mixed signals, the US spot Ethereum ETFs make a surprising move. On January 28, all nine Ethereum ETFs registered a net-zero flow.
Meanwhile, the cumulative net inflow of the Ethereum ETFs remained positive, with BlackRock leading the way with $3.99 billion. However, Grayscale Mini Ethereum Trust remains the sole ETF with a negative net cumulative flow of $3.85 billion.
ETH Price Targets
Ethereum remains trapped within a larger falling wedge pattern, but the double-bottom reversal suggests a potential bullish resurgence that could challenge the overhead resistance trendline. Ethereum’s price could see a high-momentum recovery if a breakout rally occurs.
Based on Fibonacci levels, Ethereum’s recovery rally might target the 61.80% Fibonacci level at $3,693, followed by the critical resistance at $4,108.
Conversely, if bearish momentum continues below the local support trendline, Ethereum could test the $2,900 support level, followed by $2,850.
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