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The analyst revealed what might need to happen for Ethereum to rally towards the $6,000 mark, based on the current pattern in its price.
Ethereum Appeared to be Moving Within an Upward Channel Recently
In a new post on X, analyst Ali Martinez discussed the pattern that Ethereum may have been following of late. The pattern in question is “Ascending Channel” from technical analysis (TA).
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Parallel Channels form when the price of an asset converges between two parallel lines. The upper level of the channel is drawn by connecting successive peaks, while the lower ones join the bottom.
This pattern can take three shapes: positive slope, negative slope, and zero volume. In the first of these, the trend lines trace the consolidation phase to the upside, and the pattern is known as an Ascending Channel. Similarly, in the second, prices go down, the formation is called a Descending Channel. The third type, where the trend lines are parallel to the time axis, does not have a specific name.
As with other consolidating patterns in TA, the upper line of the Parallel Channel is likely to resist the price, while the lower line may act as a support point. A break above any of these lines would indicate a continuation of the trend in that area; a break above the channel is bullish, and a fall below it is bearish.
Now, here’s a chart shared by an analyst that shows the Ascending Channel that Ethereum may have been trading in over the past few years:
As seen in the graph above, the price of Ethereum retested the high level of this channel during the first quarter session of last year. The cryptocurrency received a rejection at the level and began a downward trajectory that would eventually force it to retest the bottom line.
ETH spent a little time making a lot of linear touches during the retest, but the pattern ended up holding as the coin got a rebound. The result of the rally could not take the price to a higher level, however, as, in fact, it came out in the middle of the trip. The property has been going down.
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Interestingly, the same pattern was also seen in 2023, when the rejection between the channel led Ethereum to retest the lower line, which started the bull run.
In the chart, Martinez emphasized what the future price trend of ETH could look like if the same trajectory follows now. “If Ethereum $ETH follows a corresponding rising channel, a dip in the lower boundary at $2,800 may act as a trigger for a move to $6,000,” the analyst noted.
From the current price of the cryptocurrency, a bull rally to this final target of $6,000 would mean a growth of about 82%.
Trading currency of ETH
Ethereum has not been able to make any significant recovery from its recent decline as its price is still trading around $3,300.
Featured image from Dall-E, charts from TradingView.com