Ethereum (ETH), often referred to as the “King of Altcoins,” is once again grabbing attention as it inches toward the crucial $3,800 resistance level. After experiencing a nearly 70% rally over the past month, Ethereum is showing strong momentum. However, analysts caution that this climb may soon face a temporary pullback before any major breakout. The cryptocurrency kicked off this week by hitting a yearly high of $3,860 but was quickly rejected, falling back to around the $3,600 range. Despite the setback, Ethereum’s performance still indicates bullish sentiment, especially considering its 178% rebound from the April lows.
The rally coincides with renewed optimism across the broader crypto market, particularly as Bitcoin continues to reach fresh all-time highs. Ethereum has successfully reclaimed the important $3,000 level and has steadily approached the $3,800 resistance zone, a level where many traders are watching closely. According to on-chain analyst Ali Martinez, this $3,835 resistance level is key to Ethereum’s next move. Around 2.82 million addresses reportedly purchased 1.48 million ETH in this price zone, making it a formidable barrier. If Ethereum manages to reclaim and sustain above this level, analysts believe a push toward the next cycle high of $4,107 could be in play.
On the downside, Martinez identifies $3,490 as Ethereum’s strongest support. This is where about 4.18 million addresses acquired 3.53 million ETH. A failure to hold above this level after rejection could result in Ethereum falling back into a correction phase. Another voice, Andrew Crypto, points out that corrections are a healthy part of any long-term uptrend. According to him, “a chart without a correction isn’t a healthy chart.” He anticipates that Ethereum may fall back to its yearly opening zone, which lies between $3,300 and $3,400, especially after being rejected from its local supply zone.
Despite the short-term uncertainty, there is a growing belief among technical analysts that Ethereum might be setting up for a powerful breakout. Analyst Crypto Bullet drew parallels between Ethereum’s current chart and its price movement during the 2019–2020 period. He highlighted the formation of a Descending Broadening Wedge—a pattern that often signals a bullish breakout. Crypto Bullet believes that Ethereum is now testing the resistance of this pattern for the third time, similar to its behavior in the last cycle. Back then, a breakout led to a massive rally, and the analyst suggests this time could be no different. If Ethereum breaks through the wedge pattern, he predicts a cycle top in the $8,000 to $10,000 range.
Before such a rally, however, a 10%–15% pullback could occur, possibly bringing ETH down to the $3,300–$3,400 level. Still, this correction is seen as a potential setup for a larger breakout rather than a signal of weakness. Supporting this viewpoint, another analyst known as Merlijn The Trader pointed to Ethereum’s similar price behavior during its 2017 rally. He described the pattern as having the “same range, same fakeout, and same breakout,” drawing a strong comparison between the past and present.
In conclusion, Ethereum is currently at a pivotal moment. The cryptocurrency has shown strong bullish momentum and is testing a historically significant resistance level. While a rejection and pullback are still on the table, analysts argue that these dips may simply be a setup for a more significant rally ahead. With technical indicators aligning and historical trends pointing to a potential breakout, Ethereum holders may have reason to stay optimistic. However, traders are advised to keep a close eye on the $3,835 resistance and $3,490 support, as these levels will likely determine Ethereum’s next major move in the coming weeks. Whether ETH breaks through or pulls back, the outcome could shape its trajectory for the rest of the year.
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