Crypto Analyst Highlights Ethereum’s Megaphone Bottom

Crypto analyst TradingShot has revealed that the Ethereum price has formed a megaphone bottom not seen since 2020, offering a bullish outlook for the altcoin.

Ethereum Price Forms Megaphone Bottom

In a TradingView post, TradingShot stated that the Ethereum price has formed a megaphone bottom akin to what was seen in March 2020. He noted that ETH is currently in the first week of a rebound after experiencing three consecutive weeks of losses, unable to break above the 1-week MA50. The analyst also discussed ETH’s lower lows trendline, which represents the bottom of a year-long megaphone since the March 11, 2024 high.

TradingShot remarked that the market is familiar with long-term megaphone consolidation periods. He noted that the Ethereum price eventually broke upward the last time it formed this megaphone between June 2019 and March 2020, following the severe COVID crash.

The analyst suggested that the current bearish Ethereum price action since late December mirrors the situation in March 2020. He highlighted how aligned the Fibonacci retracement levels are, predicting that ETH could test the 1.5 Fibonacci extension at $6,000 before this cycle peaks at the end of the year.

Another crypto analyst, Crypto Patel, estimated a possible Ethereum price rally to as high as $8,000, suggesting this parabolic move could occur in phase E of ETH’s bull run, although resistance might be strong around $4,050.

Bullish Fundamentals For ETH

Despite its recent underperformance, Ethereum has bullish fundamentals that could lead to a price reversal and new highs. Analyst Alternative Bull noted a significant decline in ETH reserves on exchanges, indicating tighter supply and a potential parabolic price increase. He believes Ethereum remains in the early phases of its bull run.

Additionally, crypto analyst Ali Martinez revealed that whales are actively accumulating ETH. He reported that 360,000 ETH were withdrawn from exchanges in the last 48 hours, which could trigger a supply shock.

Ethereum could also experience supply shocks from ETH ETFs as asset managers like Bitwise file with the US SEC to include staking in their funds. If approved, institutional investors might opt to stake ETH for yields, further reducing its circulation.

As of the time of writing, the Ethereum price is approximately $1,969, down nearly 2% in the last 24 hours, according to CoinMarketCap data.

Featured image from Unsplash, chart from Tradingview.com