Home / Analysis / Crypto / Technical Analysis / Ethereum Spikes 8% Signaling The Start Of Uptrend — Can It Cross $4,000 This Time?

Ethereum Spikes 8% Signaling The Start Of Uptrend — Can It Cross $4,000 This Time?

Last Updated June 12, 2024 4:32 PM
Nikola Lazic
Last Updated June 12, 2024 4:32 PM

Key Takeaways

  • Ethereum twice failed to breach $4,000; a downturn followed.
  • The recent 8% rise suggests potential recovery from an oversold state.
  • Future uncertain: potential rally or further sharp declines possible


Ethereum’s price reached nearly $4,000 but failed to exceed it on May 27. This was its second attempt, as the previous one was on May 23. Since it lost strength, a sharp downturn followed. On June 11, it fell to a low of $3,383, decreasing by 15%, but since yesterday, we saw the start of another uprise of 8%, with ETH currently being traded at $3,623. 

Is this the start of its next advancement past the $4,000 resistance, or just a temporary reaction to the oversold conditions? 

ETH Price Analysis 

Ethereum’s price surged from a descending trendline on May 17, climbing sharply to $3,800 by May 23—a 32% increase from its low of $2,870 on May 13, indicating the start of a new uptrend. The price briefly approached $4,000 on May 27 before experiencing a downturn.

 

ETH
ETHUSD | Credit: Nikola Lazic/Tradingview

On the 4 hourly chart, Ethereum formed a symmetrical triangle from its peak on May 23, just below $4,000. As the price neared the triangle’s apex, it encountered resistance and subsequently broke below the support level, leading to a drop to a short-term low of $3,385. This decline may represent the completion of wave 4, setting the stage for a potential rally to new highs.

On June 11, the 4h chart RSI was 22%, indicating oversold conditions. This could mean ETH reached its low and is now ready for an upturn. However, today’s recovery has already brought the RSI to its mid-point, with more downsides still possible. 

If we see the increase continuing to $3,800 in the area, the likelihood of it surpassing $4,000 will increase. In that case, ETH could be eyeing a new yearly high, with the 0.786 Fib level being its next likely target of $4,200. 

But if it fails to keep up its upward momentum, we could see another sharp decline, signaling Ethereum’s further downfall past the May 1 low of $2,800. 

 

What’s Driving The Rise? 

This price action mirrors Bitcoin’s price spike and the general market sentiment due to the new CPI data release. It was revealed that the Consumer Price Index remained the same in May, which was interpreted positively by investors. 

CPI
CPI Data | Source: U.S. Bureau of Labor Statistics via FRED

As the market was previously ruled with uncertainty, this comes as a temporary relief rally. Will it ignite a new bull phase? We will need to wait and see, but the likelihood is high since the current market sentiment is positive with no looming dangers. On the other hand, more ETH Spot ETFs are awaited. The U.S. Securities and Exchange Commission (SEC) recently disclosed that it is reviewing an application from ProShares for a spot Ethereum (ETH) exchange-traded fund (ETF). This might bring further market excitement and high hopes for Ethereum investors, leading to higher Ethereum prices. 

Disclaimer
Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.
Was this Article helpful? Yes No