Ethereum Price Analysis: ETH Forms Inverted Head and Shoulder Pattern Targeting $4000

After trading sideways for a week, Ethereum (ETH) upheld support around the 50-day EMA mark. Furthermore, the Ethereum price has regained bullish momentum.

After trading sideways for a week, Ethereum (ETH) price held up support around the 50-day EMA mark. Moreover, the Ethereum price showed a recovery in bullish momentum. During this consolidation, ETH formed an inverted head and shoulder pattern and was set for an upswing.

Other factors that supported ETH’s bullish outlook were strong network growth and whale accumulation in the coin. Another factor was the positive shift in the market sentiment.

At the time of writing, the ETH price was trading at $3401, showing an increase of 2.13%. Its market cap went up to $408.33 Billion and the Total Value Locked (TVL) was at $67.998 Billion.

Ethereum Accumulation Phase Marks Potential For Long-Term Gains

Even though the overall market showed a rather bearish outlook, there were signs that investors were getting bullish. With this, holders of Ethereum accumulation addresses have held over 20 million in ETH.

The trend for this accumulation showed a sharp and continuous upward trend. The latest spike to the upside indicated aggression in the buying action.

The buying actions seemed to be from institutional investors and other long-term holders. Ethereum showed the supply squeeze as tokens were being accumulated in the accumulation wallets. This resulted in fewer tokens being supplied to the market each day.

It could also increase price pressure and decrease the available supply more in line with the general market. However, the amount of ETH flowing into these long-term holdings increased.

This showed that investors were optimistic about Ethereum’s prospects in the long term.

However, such accumulation activity continued even as the Ethereum price saw fluctuations. This showed a divergence between the market view and the strategic view.

An increase in holdings from one month to the next showed a strong conviction in Ethereum’s position in the crypto economy. This happened as it grew in this regard, from smart contracts, among other use cases, to decentralized finance (DeFi).

Such developments made Ethereum one of the most valuable assets for those preparing for the next giant trend direction.

Meanwhile, data from Lookonchain showed that Cumberland had deposited over 16.201 ETH, amounting to $55 Million, to Coinbase. Despite the significant dump, the ETH price remained resilient and saw an uptick of over 2% intraday.

Ethereum Forms Inverted Head And Shoulder Pattern: What’s Next?

On the weekly timeframe, Ethereum formed an inverted head and shoulder pattern. Moreover, the token was close to completing the right shoulder. Once the pattern is completed, the Ethereum price could see a massive upswing and might aggressively breach the $4000 neckline.

An immediate breakout above the neckline, accompanied by a high volume, would confirm the bullish chart pattern. This could act as a springboard for Ethereum to shoot higher.

Moreover, Javon Marks showed that Ethereum had formed an ‘Adam & Eve’ pattern, which signaled a bullish reversal. According to the pattern, the Ethereum price could reach $4800 in the short term.

Furthermore, the Open Interest (OI) had risen over 1.69% to $23.58 Billion. This indicated a continuous buildup activity. Also, the funding rate remained positive at 0.0092%, articulating a significant demand for long contracts.

This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading