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With Bitcoin finally rising above the long-awaited level of $100,000, Ethereum (ETH) is trying to break out of a major resistance area. The second-largest cryptocurrency rally has sparked optimism about its targets, with some suggesting it could emulate BTC’s 2020-2021 rally.
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Ethereum recovers $3,900
Ethereum, the second-largest cryptocurrency by market cap, posted a 10% rise last week, moving from the $3,500 mark to the $3,900 resistance level. On Wednesday, the altcoin king crossed the $3,800 level for the first time in six months and continued to move higher to retest the $3,900 resistance, a level not seen since early March.
In the early hours of Thursday, ETH turned this key area into support, briefly falling to $3,860 before jumping back to the recently recovered level. As the cryptocurrency approaches a yearly high of $4,093, sentiment around the token’s short-term performance has turned very bullish.
Ethereum is retesting a massive multi-year resistance area, which could send ETH to a new ATH. According to analyst Alex Clay, the cryptocurrency is trying to do just that break “Through the key resistance area on the weekly time frame.”
ETH has settled in the key zone five times since 2021, and has faced rejection from the upper resistance at $3,950 on four occasions before. However, Ethereum surpassed this level in late 2021, when it reached an all-time high (ATH) and held above it for about three months.
The analyst noted that if the altcoin king succeeds in breaking this level and turning it into support, it will be the next “breakout” and smash his ATH. Clay added that he does not see “any significant decline anytime soon.”
Likewise, cryptocurrency analyst Jelly male That if Ethereum surpasses the March high, “all bets are off,” suggesting that the chances of Ethereum continuing a long consolidation period before a new ATH like BTC emerges were “very low.”
Will ETH rise towards $10,000?
Gilley also noted that Ethereum’s current setup mimics Bitcoin’s setup in July 2020. According to the chart, Bitcoin broke out of a multi-year downtrend line by mid-2020, followed by a massive 500% 10-month rally towards the $60,000 mark in April 2021.
The analyst noted that ETH broke through a multi-year trend line today, like BTC in 2020, which could lead to a similar rally towards new highs in the next few months. He added that investors “would be entertained if anything similar happened.”
In another post he said: Highlight Ethereum started to rise when Bitcoin broke its ATH price and entered price discovery when BTC traded almost 100% above its previous cycle high.
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He believes it would be surprising “to see things play out similarly this time around. BTC and ETH price rise in tandem, leading to ETH price discovery somewhere around ±$130,000.”
Based on this, the analyst believes that a 150-200% rally towards the $10,000-12,000 price range for the cryptocurrency is possible for this cycle. As of this writing, ETH is trading at $3,905, an increase of 2.4% on the daily time frame.
Featured image from Unsplash.com, chart from TradingView.com