A seasoned analyst says Ethereum will now surge to $6,000 as it retests a key level and bounces in its upward channel.
Analyst Ali Martinez has identified $2,400 as a critical support level for Ethereum, indicating that a rebound from this point could lead to a potential rally toward $6,000 as the cryptocurrency tests this important zone.
Since July 2023, Ethereum has been moving within an ascending channel.
Recent price movements brought Ethereum close to the lower boundary of this channel.
As of October 26, the cryptocurrency retested this lower trendline.
Martinez emphasizes that the current price around $2,400 is a significant support area.
He believes that a bounce from this level could pave the way for a climb toward the upper boundary, which he estimates to be around $6,000.
The ascending channel pattern, defined by two parallel trendlines, clearly indicates resistance and support zones that guide Ethereum’s price movements.
The upper boundary acts as resistance while the lower boundary offers support.
Ethereum’s approach to the $2,400 mark is seen as an essential test of this support.
In response to Martinez’s optimistic outlook, some commenters expressed concerns that the price could break below the support level instead of rising.
However, Martinez countered that there is a favorable risk-to-reward ratio if stop-loss orders are placed between $2,300 and $2,150.
As of now, Ethereum is recovering from previous losses, trading at $2,509.34.
Additional analysis from IntoTheBlock shows on-chain metrics that suggest a bullish sentiment for Ethereum.
Approximately 70.34% of Ethereum addresses are currently profitable, while only 1.74% are at break-even, and over 27% are experiencing losses.
This distribution typically alleviates selling pressure, as fewer holders are likely to sell at the current price levels.
With the majority of holders in profit and minimal break-even positions, market conditions seem favorable for continued movement within the ascending channel.
Meanwhile, in response to community concerns regarding the Ethereum Foundation’s periodic ETH sales, co-founder Vitalik Buterin explained the reasoning behind these actions.
He noted that the proceeds from the sales are used to fund core development projects aimed at reducing transaction times, lowering fees through EIP-1559, and transitioning Ethereum from a Proof of Work system to preserve token value.
Buterin also addressed the Foundation’s decision not to stake all its ETH holdings, citing the need to remain neutral during contentious hard forks.
The Foundation is exploring alternative strategies, such as delegating staking to third parties while ensuring ethical oversight.
This approach aims to spread Ethereum’s legitimacy across multiple organizations, thereby enhancing the stability of the ecosystem.
But I’m curious to know what you think about Ethereum at the moment.
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