Analyst Eyes $6,000 For Ethereum As Key Support Level Emerges – Details
Price action in Ethereum has attracted the attention of investors and analysts alike, as it trades near a critical support level at $2,600. Analyst Ali Martinez has pinpointed this region as the critical threshold that Ethereum will cross before it makes its next significant move.
If this support is sustained, according to Martinez, it shall serve as the catalyst in staging a rally to usher the cryptocurrency to the ambitious target of $6,000. However, things do not seem that smooth ahead as already some market observers and participants have opined that the existing support could break under pressure.
#Ethereum is testing a key support zone at $2,400. If this level holds, we might see $ETH aiming for the channel’s upper boundary near $6,000! pic.twitter.com/W8J8WVy5CL
— Ali (@ali_charts) October 26, 2024
Ethereum has begun forming a rising channel from July 2023. An ascending channel is a technical pattern in which two parallel trend lines represent the support and resistance level. Recently, the price of Ethereum stayed near the lower edge of this corridor. Martinez believes that Ethereum will rally from here, so everyone’s holding on tight.
Important Support And Resistance Zones
The ascending channel pattern does not occur by accident. It indicates the probable paths of Ethereum. The trend line acts as a resistance level in the channel, while the trend line at the bottom actually acts as a support level for the price to bounce. The move of Ethereum past $2,600 is also an important retest point that will act as a pivot for its new price target.
Martinez believes this is a good risk-reward opportunity for the investor and recommends placing stops at around $2,00 to $2,150. The idea behind these stop-losses is to limit the potential losses, but they also open up upside in case Ethereum moves higher towards the upper trendline.
This observation appears somewhat vague, as some analysts are expressing concerns about a potential breakdown at the $2,500 range. However, Martinez has not provided much insight into how this situation could still create favorable conditions for a rally to occur.
Indicators Look Positive: On-Chain Data
On-chain data shows 70% of Ethereum holders are profitable. Therefore, this positive attitude would be further supported in terms of the level of profitability that reduces the chances of big sellers. When there aren’t strong motives for selling, then an upward movement for Ethereum could easily be expected.
Robust Long-Term Projections
Meanwhile, the future estimates for Ethereum have room for growth. The current market predictions reveal that Ethereum is trading about 6.5% lower than the predicted target for next month, which also means the asset is underpriced.
More positive projections for the long term range from 173% possible returns in a year, according to figures by CoinCheckup. Such growth could probably give a push to Ethereum’s upward movement and form a firmer support base that may encourage price levels to stay high and stabilized.
Featured image from StormGain, chart from TradingView
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