Key takeaways:
ETH faces a potential 15% decline towards $3,560 after slipping below its symmetrical triangle pattern.
Bulls must protect the ascending trendline support to prevent a deeper downturn.
Ethereum’s Ether (ETH) token has dropped over 7.50% this week due to de-risking sentiment throughout the crypto market.
Additionally, technical analysis indicates that the ETH price drop has initiated a classic bearish reversal setup, suggesting further downside potential ahead.
Ether price risks 15% drop in the near term
Ethereum’s breakdown from the symmetrical triangle shifts the short-term outlook to bearish. Generally, such patterns resolve in the direction of the prevailing trend, but a downside breach can convert the pattern into a reversal signal.
The measured move from this triangle setup suggests a target of $3,560, indicating ETH could decline another 15% from current levels if selling pressure continues.
This target aligns with the support range highlighted by analyst Michaël van de Poppe.
In his Tuesday post, the analyst discusses the possibility of ETH price falling within the $3,550-$3,750 range, noting the 20-week exponential moving average (20-week EMA; the blue wave in the chart below) around $3,685.
“Compression is building up –> Big move to occur at a later time,” Poppe states, adding:
“It’s now down nearly 20% from the high, not a bad spot to be accumulating your first positions.”
Despite the triangle breakdown setup, the bulls have a defense line.
ETH is currently near a rising trendline that has supported its uptrend since April, leading to rallies of 90%-125% previously.
A rebound from the trendline, followed by a decisive close above the 50-day exponential moving average (50-day EMA; the red wave) around $4,250, could spark an extended recovery towards the triangle’s upper trendline, aligning with the $4,600-$4,700 range.
Ethereum rebound could extend to $7,000
A bounce from the ascending trendline support raises Ether’s chances of reaching a new all-time high at $7,000, based on a separate analysis from Crypto GEMs.
This outlook relies on the Wyckoff Accumulation method, indicating that ETH has already completed its “spring” and “test” phases earlier this year.
These phases generally signify the conclusion of a bearish cycle and the onset of a robust uptrend.
Within this framework, Ethereum’s recent drop is viewed as the “Last Point of Support” (LPS), a healthy retest of a prior resistance level before the price resumes its ascent.
This setup positions ETH for a breakout rally aimed at the $7,000 target if validated.
Related: ETHZilla unleashes fresh $350M war chest for Ethereum bets
This implies at least 65% gains by the end of 2025, mirroring various other ETH price targets shared by analysts earlier this year.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
