Ethereum (ETH) is currently displaying promising signs of a bullish breakout, as it forms a complex Inverse Head and Shoulder (iH&S) pattern on the weekly timeframe. This significant technical formation indicates that the Ethereum price may be gearing up for a substantial rally towards a bullish target of $18,000.
The Ethereum price has been undergoing a prolonged consolidation phase, experiencing a sharp decline amidst the recent market turbulence. Despite facing significant drops that have pushed its value well below its all-time highs, respected crypto analyst Gert van Lagen on X (formerly Twitter) remains optimistic, predicting that ETH has the potential to reach a price target of $18,000.
Notably, Ethereum recently bounced off the $1,800 – $2,000 support range, which previously acted as resistance during the ‘Head’ phase of the iH&S pattern. This successful retest confirms a crucial stage in the reversal process, potentially paving the way for Ethereum to reach new all-time highs.
Gert van Lagen’s bullish target of $18,000 represents a substantial increase from Ethereum’s current price, highlighting the magnitude of this projection. By identifying the formation of the iH&S structure on the Ethereum chart, van Lagen supports his ambitious prediction with this renowned bullish chart pattern.
The Inverse Head and Shoulder pattern is a classic bullish reversal formation that often signals the end of a downtrend and the beginning of a new uptrend. Given Ethereum’s recent bearish trend, the emergence of the iH&S chart pattern suggests that the extended decline may be coming to a close.
Analyzing van Lagen’s chart, the left shoulder of the iH&S structure began taking shape from 2021 to 2022, reaching a price peak before retracing. Subsequently, a more profound decline occurred from 2022 to 2023, marking the cycle low and forming the ‘Head.’ Finally, the right shoulder of the technical pattern developed between 2024 to 2024, recording a higher low that aligns with the left shoulder.
The most critical level to monitor, according to van Lagen, is the neckline of the iH&S structure, which sits around $3,978 and serves as the primary resistance area.
To achieve the $18,000 ETH target, Ethereum must surpass the $3,978 resistance level with strong volume, validating the Inverse Head and Shoulder pattern and potentially triggering a rally towards $18,000. Failure to breach this resistance level could lead to a prolonged consolidation or significant pullback before the next breakout attempt.
In the event of a rejection at the resistance area, van Lagen anticipates that the Ethereum price could retreat to $1,888, a crucial support level that may prevent further declines. This potential drop to the support level would represent a 52% dip from the primary resistance level and an 8.52% decline from Ethereum’s current market value of $2,055.
In conclusion, Ethereum’s technical indicators suggest a possible bullish breakout towards $18,000, contingent on overcoming key resistance levels and maintaining positive momentum in the market. As always, it’s essential for investors to conduct thorough research and consult with financial advisors before making any investment decisions.