Ethereum consolidates, ending a 7-month-long downtrend. On the higher time frames, the coin is bound to appreciate. Considering the macro uptrend that has been building for the past 5 years, it is expected to rise to $10K. “The bigger the base, the higher in space.”
On the four-hour chart, Ethereum has just broken out from a bull flag and is currently testing the resistance level at $2,125. A bull flag is characterized by a significant run-up in prices, followed by a brief period of consolidation in which the price slightly declines.
This is not a pullback, as there is no significant selling taking place. Instead, there is a lack of buying, and the volumes have started to fall. Some investors are selling, and some are looking for ways to short the stock, but the stronger investors are either selling or accumulating.
The overall idea is still bullish, as the price has not fallen and has not broken down. After some time, the price breaks above the higher boundary of the flag, and the volumes start rising. This leads to a continuation of the same trend. It is estimated by assuming the height of the first run-up and projecting it from the breakout point. In the case of ETH, there has been a resistance at $2,125, and the relative strength index has curved, indicating a reading of 64.
Going by the indicators, it looks like the bullish uptrend is over and the prices might go through a pullback. However, on the higher time frames, ETH might not go through a pullback.
A crypto analyst who goes by the pseudonym Sykodelic expects that the chances of Ethereum appreciating are very high compared to it crashing. To substantiate his point of view, the analyst provided a 1-month ETH chart and predicted it could hit $10K in the coming days.
Even on the weekly chart, Ethereum’s setup is looking very bullish, as it has made a new higher low above the $2,000 level.
Since the uptrend of making higher lows was established four years ago, it will take much effort for the bears to dismantle this pattern. As such, the chances of ETH surging is much higher than crashing. Given that the abovementioned thesis plays out, ETH will first hit resistance at $2,800.
