Analyzing Ethereum’s Sluggish Price Recovery – Is an ETH Turnaround Possible in Late 2024?

Key Takeaways

• The Ethereum (ETH) price has increased slightly over 25% since its Aug. 2024 lows.
• The price trades 44% below its all-time high of $4,868 in 2021.
• Will Ethereum finally start playing catch up to other major cryptocurrencies?

The Ethereum price has declined since its yearly high of $4,091 in March. At one point, the decrease amounted to 48%. Unlike Bitcoin (BTC), Ethereum has not reached a new all-time high price this cycle.

Why has Ethereum underperformed, and can its luck turn around before the end of 2024?

Ethereum Holds Above Support

Since its August lows, ETH has increased by only 27%, notably less than other major cryptocurrencies, even though its fall was more severe. However, the increase is extremely important based on the price action.

Even though Ethereum did not create a bullish candlestick, it validated the $2,400 horizontal support area and the middle of an ascending parallel channel, which previously contained the price movement for nearly two years.

However, while the price action is positive, technical indicators are not. This is noticeable in the weekly RSI, which has fallen below 50, and the MACD, which crossed into negative territory.

In the previous bullish cycle, ETH had one correction of over 50%, after which it began its final upward movement of the cycle. Despite this sharp decline, neither the RSI nor the MACD crossed below their bearish thresholds during the correction.

So, while based on the price action ETH had a similar correction in the previous cycle, the bearish indicator readings are unprecedented for the second-largest cryptocurrency.

Two Potential Ethereum Wave Counts

As for the rest of 2024, two potential Ethereum wave counts are still in place. Both are somewhat irregular because the increase after the local low in June 2022 and the drop after the yearly high of March 2024 are three-wave structures.

So, the first count indicates that ETH is in an expanding diagonal, where each structure is a three-wave one. This fits with the ETH bounce at this middle of the channel since that creates a fourth-wave pullback.

In this account, the ETH price has started the fifth and final wave of its increase, which often extends in diagonals. The target range for the top of the high is between $4,650 and $5,290.

Giving wave five the the same length as wave three creates the lower portion of the target. The 1.61 external Fibonacci retracement of wave four gives the upper limit, which would be a new all-time high.

The other count suggests ETH has corrected in a long-term wave four since the all-time high. Wave four has taken the shape of a symmetrical triangle, the most common pattern in wave four.

While the ETH price action and the count fit perfectly, wave four is extremely elongated compared to wave three. This casts some doubt about its validity.

The target for the high is at $7,100, created by the 1.61 external Fibonacci retracement of the long-term fourth wave.

So, both counts predict an Ethereum  increase to at least $3,500. The reaction once the price gets there will be key to determining  the correct one.

About the Author

Valdrin Tahiri

Valdrin discovered cryptocurrencies while getting his MSc in Financial Markets from the Barcelona School of Economics in 2017. He has been an avid investor and trader since. Valdrin has written for several cryptocurrency media companies such as BeInCrypto and CoinGape.

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