Ethereum’s Price Outlook: Potential Downturns and Key Resistance Levels

Ethereum (ETH) has recently been trading 25% above its eight-month low of $2,112, which was reached on August 5, 2024. Despite this rebound, notable analysts are suggesting that the altcoin may face significant downward risks in the near future. This article delves into the latest predictions from prominent cryptocurrency analysts, including Peter L. Brandt and McKenna from Arete Capital, regarding Ethereum’s price movements and potential support and resistance levels.

Current Market Situation

As of mid-August 2024, Ethereum is priced at approximately $2,614, reflecting a 13% increase over the past week. This recovery follows a significant drop on August 5, when ETH fell by 21% to reach a low of $2,112. However, analysts remain cautious about Ethereum's future performance due to ongoing market uncertainties and resistance at key levels.

Peter L. Brandt’s Price Prediction

Peter L. Brandt, a well-known Ethereum trader, has made a bold prediction about Ethereum's future price. According to Brandt, ETH could potentially fall to $1,651, marking its lowest level since October 2023. This forecast is based on technical analysis and the observation of Ethereum’s price action.

Brandt highlights two critical chart patterns that suggest a bearish outlook for Ethereum:

1. Rectangle Pattern: Brandt notes that Ethereum’s recent price movements align with a five-month rectangle pattern. According to this pattern, if ETH rises above $2,960, it would offer an ideal exit point for long positions. However, with the coin currently trading below this level, the bearish target of $1,650 remains plausible.
2. Rising Wedge Pattern: Additionally, Brandt identifies a rising wedge pattern on an intraday chart. This pattern, characterized by narrowing price ranges with higher highs and higher lows, generally signals a potential downward reversal. The occurrence of this pattern supports Brandt’s prediction of a price decline.

McKenna’s Market Perspective

McKenna from Arete Capital provides another perspective on Ethereum’s price trajectory. In a post on August 15, McKenna expressed skepticism about Ethereum’s ability to surpass $2,800 to $2,900 in the near term. Instead, McKenna anticipates that ETH will remain range-bound through August and possibly into September.

McKenna attributes recent price action to several factors, including the impact of ETH dumping by market maker Jump Trading and broader economic concerns about a potential global recession. The supply congestion zone at $2,800 has proven to be a significant resistance level, limiting Ethereum’s ascent to $2,750 on August 12.

Resistance and Support Levels

The current price of $2,614 is facing resistance near the $2,800 mark. According to McKenna, this resistance level has hindered further upward movement. If Ethereum fails to break through this zone, it may struggle to sustain its current levels and could potentially test lower support levels.

Brandt’s analysis also highlights the importance of the $2,200 support level. If Ethereum loses this support, it may further extend the downward trend, aligning with Brandt’s bearish target of $1,650.

Conclusion

The current technical analysis of Ethereum reveals a complex and potentially challenging landscape for the altcoin. While Ethereum has recently rebounded from a significant low, analysts like Peter L. Brandt and McKenna suggest that the cryptocurrency may face substantial downside risks. With resistance levels at $2,800 and potential support at $2,200, the coming weeks could be critical in determining whether Ethereum will maintain its current price or experience a further decline. As always, investors should stay informed and consider both technical indicators and broader market conditions when making investment decisions.

August 2024, Cryptoniteuae