Ethereum is nearing a breakout from a descending channel targeting $2,500.
A successful breakout could lead to a 71.29% price increase for Ethereum.
Ethereum’s price action within the channel is signaling potential bullish momentum.
Ethereum has been trading at the support and resistance levels for the past four months, being trapped in a downward-sloping channel. A break above the roof of this channel hints toward a strong bullish rally, probably to $2,500, since the chart depicts a 71.29% possible move away from the consolidation zone upon breakout.
A downward-sloping channel has Ethereums trapped in a narrow limit of price-making lower highs and higher lows. However, such a formation is more or less expected to inform the trader about a forthcoming price movement once the asset breaks out of range. Since traders are anticipating a breakout, a change in market sentiment will almost immediately follow, potentially setting the stage for an explosive upward trend.
Ethereum: Current Price Action
The Ethereum price was in steady trading downward against the bearish resistance of the channel. The support demonstrated good recovery, while the resistance keeps fading away with time. Presently, the lower edge of the channel is being tested by the cryptocurrency, increasing the probability of a bullish breakout. Provided Ethereum holds support and does not break lower, then the probability of a bullish breakout increases.
Traders are already tracking closely the price action and any momentum build-up with volume as this pattern unfolds. Movement within this channel appears to be a strong precursor to a potential breakout, one that should see Ethereum price undergo a strong upward surge. A hold above this price level accompanied by a strong breakout past the resistance level mentioned would put $2,500 in the short term as marked by recent chart patterns.
Breakout Potential Towards $2,500
If Ethereum breaks out successfully from this descending channel, the rally will add a lot of upside momentum to Ethereum price action. The chart indicates that upon assuming a break above the upper boundary, Ethereum is set for an approximately 71.29% move. This move will put it around $2,500, last seen for that level just before the recent bear run started.
Further, the upward price action within the pattern increases the likelihood of the breakout happening any time soon. If Ethereum can surpass the current resistance levels, it would activate increased buying pressure, pushing the cryptocurrency toward the next resistance at $2,500, a level being closely monitored by traders in anticipation of a possible bullish move. Read MoreNews, Altcoin News, Blockchain News, DeFi News, Ethereum News, NewsNow, Price Analysis, Altcoin, Crypto market, cryptocurrency, Ethereum
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