After Monday's decline, Ethereum (ETH) briefly fell below a crucial support level, hitting its lowest price since November. Despite this, several market analysts remain bullish, predicting a significant crypto rally this quarter.
Ethereum Dips to Two-Month Low
Ethereum started the week with a notable correction, dropping to its lowest price in two months. Over the weekend, ETH had hovered between $3,200 and $3,340 after recovering from last week’s dip.
Analyst Ali Martinez highlighted ETH’s key resistance zone between $3,360 and $3,450, where 437,000 addresses acquired 6.47 million ETH. He also identified critical support at $3,066–$3,160, where 412,000 addresses bought 4.9 million ETH.
While Ethereum tested this support during December’s correction, it rebounded afterward. However, the "altcoin king" dropped below this level for the first time since November 9, hitting $2,920 on Monday.
After a 12% retracement from weekend highs, ETH retested post-election breakout levels, confirming the $2,900 range as support. The asset swiftly rebounded, surging 9% to the $3,100–$3,200 range.
Analysts Spot Bullish Reversal Signals
Trader Miky Bull viewed ETH’s recent dip as a "perfect setup for a massive reversal," suggesting it could complete an inverse head-and-shoulders (IH&S) pattern—a bullish indicator targeting $7,000.
Several analysts have noted ETH’s months-long IH&S formation, with the left shoulder near $2,800. Rekt Capital remarked, *"Any pullback toward $3,000 could form the right shoulder."*
Meanwhile, Crypto Bullet observed similarities between ETH’s current chart and its 2021 bull run, where a double-top pattern preceded a breakout past all-time highs (ATH). The analyst suggested ETH might repeat this pattern, with a worst-case scenario of retesting ATH levels.
Seasonal Trends and ETH’s Outlook
Trader Daan Crypto pointed out ETH’s historical early-year volatility, noting, "ETH tends to move wildly in January." Data from CoinGlass shows ETH’s weekly returns were mostly negative in early 2024 but turned positive for six consecutive weeks by February—hinting at a potential trend reversal.
As of writing, ETH trades at $3,230, up 3% daily.
FAQ
Q: Why did ETH drop below $3,000?
A: Market corrections and profit-taking pushed ETH below key support, though bulls quickly reclaimed the $2,900–$3,000 zone.
Q: What’s the inverse head-and-shoulders pattern?
A: A bullish reversal setup where an asset forms two lower peaks (shoulders) around a deeper trough (head), signaling upward momentum.
Q: Could ETH hit $7,000 in 2024?
A: Analysts like Miky Bull believe the IH&S breakout could propel ETH toward $7,000, but macro conditions will play a role.
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Chart data sourced from TradingView; featured image via Unsplash.
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