ETH is currently sitting at a confluence of support levels, which could play a crucial role in determining its future trend.
Ethereum price is approaching channel support
On the daily timeframe, ETH has been trading within an ascending parallel channel for the past 95 days. It reached a local high of $2,717 on January 12, testing the resistance line of the channel.
However, since then, Ethereum has experienced a downward slide and is now nearing the support line of the pattern. It is currently in a significant horizontal area that previously acted as resistance. A bounce from this level would validate it as a support zone.
Source: TradingView
The daily relative strength index (RSI) suggests that the decline may continue. The indicator has formed a bearish divergence (green) and is below 50, indicating a downtrend.
Analysts’ perspectives
Despite the ongoing decline, traders and analysts on Platform X remain optimistic about Ethereum’s prospects.
MuroCrypto revealed that they are holding long positions in ETH with a target of $2,700:
4-hour ETH/USDT chart. Source: X
TheCryptomist believes that a rebound could be the starting point for an altseason. She stated:
“While others are afraid, I am excited! We have reached the support level I mentioned last week. If there is a rebound… it will be ALTCOIN SEASON.”
Finally, VellaCryptoX suggests that Ethereum will see an upward movement towards $2,800.
ETH Forecast: Is the Bottom Near?
Although the daily timeframe shows a bearish outlook, the four-hour chart indicates the possibility of a rebound.
The chart below illustrates that ETH has bounced off the support line of the ascending parallel channel, coinciding with the short-term descending wedge support (white). The wedge pattern is considered bullish.
Additionally, the four-hour RSI has moved out of the oversold zone after briefly dipping below it (green circle).
If Ethereum breaks out of the wedge, it could rise 8% towards the channel resistance line at $2,580. This line also aligns with the 0.618 Fibonacci level.
Source: TradingView
However, a breakdown below the lower boundary of the channel could trigger a 9% drop in ETH, bringing it down to the nearest support at $2,170.
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