- Ethereum trades near $3,850, approaching wedge resistance, with momentum indicators signaling possible bullish continuation.
- The 1.272 Fibonacci extension points to a breakout target around $7,800, aligning with prior macro cycle projections.
- Traders are monitoring $3,050 as a key support zone before potential breakout confirmation in Ethereum’s weekly structure.
Ethereum Forms Bullish Pattern Near Key Technical Levels
Ethereum (ETH) is forming a descending broadening wedge on the 1-week chart, similar to the setup that preceded its 2020 rally. The pattern, observed by traders and shared on social platform X, has drawn comparisons to historical bullish reversals in ETH’s macro price structure.
The asset is priced at $3,859.96 as of writing, with a 1.19% gain in the past 24 hours and a 6.74% rise over the past week. The price is trading just below the key $3,900 resistance, nearing the wedge’s upper boundary. Traders are preparing for a directional move as the structure compresses near its apex.
Key Fibonacci Zones Define Ethereum’s Path
Technical analysis suggests Ethereum may dip to $3,050 before a breakout, which aligns with the 0.382 Fibonacci retracement zone. This level has acted as a pivotal support in prior macro cycles, offering a possible retest zone before trend continuation.
In case of an increase of the wedge, the following resistance will be that of about 7,800, and it is calculated as the 1.272 Fibonacci extension. A better uptrend might see the price go above the $8,806 mark, the 1.414 extension, which coincides with the past exhaustion points during other bull market scenarios.
Momentum Indicators Support Breakout Setup
Indicators of momentum like Relative Strength Index (RSI) and Stochastic RSI are both in the upward trend. RSI has recaptured the 50-line, indicating an increase in buyer control, and Stochastic RSI is beginning to enter the overbought territory, which was the case in 2020 at the start of the breakouts.
A tweet from @CryptoCrewU confirmed the pattern and highlighted the importance of level-by-level strategy. The $4,500 resistance level remains critical, and confirmation will require a weekly close above this zone. Until that time, traders are urged to beware of volume and structure integrity.
The technical setup of Ethereum at the moment is that of a coiled positioning, with momentum, structure and historical comparison pointing to a breakout possibility within the subsequent weeks..
