TLDR
Ethereum surpassed $3,670 resistance and shows promising signs for a potential $4,000 breakthrough after three failed attempts since March 2024
Technical analysis reveals a bullish inverse head-and-shoulders pattern forming, suggesting a possible trend reversal
Analyst Daghan projects potential surge to $8,047 if ETH breaks above $4,150
ETH is maintaining position within an ascending parallel channel targeting $6,000
BlackRock’s Ethereum ETF has accumulated over 1 million ETH, adding institutional backing
Ethereum has surged past $3,670, marking its fourth approach toward the stubborn $4,000 resistance level in 2024. The second-largest cryptocurrency by market capitalization currently trades at $3,696, showing a 1.9% increase over the past 24 hours.
The recent price movement has formed a technical pattern known as an inverse head-and-shoulders, typically considered a bullish indicator by market analysts. This pattern consists of three troughs – a lower central trough (the head) flanked by two higher troughs (the shoulders).
Cryptocurrency analyst Trader_XO highlighted this formation on social media platform X, suggesting that multiple tests of the $4,000 level increase the probability of an eventual breakthrough. The pattern’s neckline, which serves as the key resistance level, aligns closely with the $4,000 price point.
$ETH
Stated my expectations on the previous tweet and the livestream on the 22nd
Barring any pullbacks into the gray zone, expectations remain the same
4th tap of 4k = probability towards it breaking higher https://t.co/wi6hNw8WtC pic.twitter.com/IkuT3OpFRB
— XO (@Trader_XO) January 3, 2025
Another analyst, Daghan, provided additional context for potential price targets, noting that a break above $4,150 could trigger more substantial price movement. “Nothing has truly begun yet,” Daghan stated, describing the current setup as a “textbook continuation pattern.”
The market structure shows Ethereum maintaining position within an ascending parallel channel, as observed by analyst Ali Martinez. This technical formation consists of two upward-sloping parallel lines containing the price action, suggesting a possible path toward $6,000.
$ETH needs to break above $4150 for the real fun to start. Nothing has truly begun yet.
This is a textbook continuation pattern that will likely lead to a strong impulse, but it takes time to fully develop. pic.twitter.com/k8uuGPee2n
— Daghan (@DaghanTrading) January 6, 2025
BlackRock’s Ethereum ETF has accumulated over 1 million ETH, demonstrating growing institutional interest in the asset. This accumulation adds another layer of support to the current market structure.
Technical indicators include a reset in the weekly Relative Strength Index (RSI), which some analysts interpret as a potential springboard for price action. The RSI measures momentum and can signal whether an asset is oversold or overbought.
The $4,000 price level has proven to be a challenging resistance point, with Ethereum testing it three times since March 2024. Each previous attempt failed to break through, making this fourth approach particularly noteworthy for market observers.
Market data shows Ethereum’s current market capitalization exceeding $450 billion, maintaining its position as the second-largest digital asset. The price represents a 1.9% increase over the previous day’s trading.
The ascending parallel channel pattern observed in the price action suggests steady accumulation, with traders establishing higher lows and higher highs. This type of price movement often precedes larger directional moves.
Some analysts project potential targets as high as $8,047, though such predictions depend on Ethereum first breaking above the immediate resistance at $4,150. The current pattern development suggests a measured approach to these levels rather than sudden movements.
The inverse head-and-shoulders pattern currently in formation would require confirmation through a definitive break above the neckline. Traders typically look for a successful retest of this level as support after the initial breakthrough.
Trading volume has remained consistent throughout this pattern formation, providing stability to the current price structure. This stability supports the technical setup observed in the charts.
The most recent price action shows Ethereum holding above the $3,670 support level, which previously acted as resistance. This price level now serves as a foundation for potential moves toward $4,000.
At press time, Ethereum trades at $3,696 on major exchanges, maintaining its position within the ascending channel pattern while approaching the critical $4,000 resistance level.
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