Will Ethereum make a bullish reversal to $2,500 as ETH price action signals a potential wedge breakout rally ahead?
Ethereum fluctuates near the $1,900 level as Bitcoin holds above $81,000. Notably, Ethereum has recorded a 13% drop in the past seven days.
However, a reversal pattern is emerging on the 4-hour chart, hinting at a potential bounce-back. Could this lead to a new wave of bullish momentum for Ethereum?
Ethereum Price Eyes Wedge Breakout For New Recovery Wave
On the 4-hour price chart, Ethereum is showing a declining trend but gaining momentum. The price drop has breached the 78.60% Fibonacci level, testing a local support trendline.
Ethereum price chart
The support trendline forms a falling wedge pattern on the 4-hour chart, with an overhead resistance trendline. Currently, the bullish reversal from the trendline, accompanied by lower price rejection, struggles to maintain dominance at the 78.60% Fibonacci level.
This crucial Fibonacci level is at $1,897. At present, Ethereum is trading at $1,907, reflecting a 2.04% price surge in the past four hours.
Technical indicators support the chances of a bullish reversal. The MACD and signal lines are on the verge of a positive crossover. Furthermore, the 4-hour RSI line has bounced off from the oversold region.
With a fresh wave of bullish momentum, Ethereum is likely to challenge the overhead trendline, which is close to the $2,000 psychological mark.
Analyst Signals Potential Recovery
With the short-term bounce-back in Ethereum from local support, network activity spiked. According to analyst Ali Martinez, the number of active ETH addresses has jumped 17% in the past 24 hours.
This marks a significant rise from 429,000 to 503,000 active addresses on the Ethereum network. As the number of active ETH addresses grows, this rising activity could lead to additional demand.
> The number of active #Ethereum $ETH addresses jumped 17% in just 24 hours, climbing from 429,000 to 503,000! pic.twitter.com/EZLaOwLrEi
>
> — Ali (@ali_charts) March 11, 2025
However, the analyst also highlights a surge in ETH supply on exchanges. Based on data from Santiment, more than 100,000 ETH has been moved to exchanges in the past 48 hours. This has led to a significant supply surge on exchanges, reaching 9.23 million ETH.
Moreover, the analyst points out crucial resistance for Ethereum between $2,248 and $2,610, based on the Global In/Out of the Money indicator from IntoTheBlock.
This resistance zone holds 65.24 million ETH across 12.28 million addresses. Therefore, the short-term recovery in Ethereum will need to surpass this critical level for a sustained recovery.
> #Ethereum faces a key resistance zone between $2,250 and $2,610, where 12.28 million investors accumulated over 65 million $ETH! pic.twitter.com/gEPeRTeYFR
>
> — Ali (@ali_charts) March 12, 2025
Ethereum ETFs Record Fifth Consecutive Day of Outflow
As Ethereum’s price remains volatile, U.S. Ethereum spot ETFs recorded a net daily outflow of $21.57 million on March 11. This includes an outflow of $11.82 million from BlackRock and $9.75 million from Fidelity.
The remaining seven ETFs showed no outflow. Since March 5, Ethereum ETFs have experienced five consecutive days of outflows, totaling $181.41 million.
Key ETH Price Targets
While the short-term increase in network activity hints at a potential bounce-back, critical resistances for Ethereum remain. However, the falling wedge breakout rally could trigger a new wave of bullish momentum.
Based on the Fibonacci levels, a breakout from the pattern would likely challenge the 50% Fibonacci level near $2,500. This price level aligns with the key on-chain resistance zone mentioned by Ali Martinez.
On the flip side, a failure to maintain the bullish momentum would likely lead to a retest of the $1,757 support level, close to the local support trendline.
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