The analyst explained how Ethereum could fall towards the $6,000 level if this historical pattern continues for the asset’s price.
Ethereum’s rising channel may reveal its next destination
In the novel one post on X, analyst Ali Martinez discussed the pattern that Ethereum’s 1-week price has potentially followed over the past few years.
The pattern in question is the “ascending channel” of technical analysis (TA), which is a type of parallel channel. In a parallel channel, assets consolidate between two parallel trend lines, with the upper level connecting successive highs and lower lows.
In the case of an ascending channel, these two levels are inclined upwards, as its name already suggests. Therefore, an ascending channel only forms when an asset marks higher highs and lows.
The lower level of the formation can support the price, while the upper level can act as resistance. If any of these levels are broken, the trend in that direction may continue for the asset; a rise above the top line can be a sign of bullishness, while a fall below the bottom line can herald a bearish outcome.
There is also another type of parallel canal, called the descending canal, which functions similarly to the ascending canal, except that it points downwards.
Here’s a chart shared by Martinez that shows the Ascending Channel what Ethereum’s weekly price may be currently trading:
As shown in the chart above, the 1-week Ethereum price recently retested the lower level of a potential ascending channel pattern. The analyst highlighted what happened several times when the coin retested this line.
“Any bounce off the lower boundary of this channel has historically led to an average 130% increase in the Ethereum price,” notes Martinez. So, if the rising channel continues to sustain the cryptocurrency, it could soon benefit from another rally
“If this pattern continues, a similar move could push ETH to $6,000 – provided the $2,300 support level remains intact,” the analyst says. This level of support naturally corresponds to the lower line of the channel, and a drop above it could potentially invalidate the formation.
With this pattern shaping up on the weekly chart, it remains to be seen how Ethereum’s price will develop in the coming months.
ETH price
Ethereum has surged 7% in the last 24 hours, pushing its price above $2,600.