After a slight price decline on Friday, Ethereum (ETH) showed a great deal of resilience as it rose by 2.84% over the past 24 hours. Commenting on the altcoin’s potential next moves, cryptocurrency analyst Ali Martinez charted a potential path to a new all-time high of $6,000.
Ethereum is now in a critical support zone – here’s why
in Share X On Saturday, Martinez said that Ethereum is currently testing a key support level at $2,400. Notably, Ethereum fell to around $2,410 on Friday and has since remained in this price zone after the recent rejection at $2,500. According to Ali Martinez, ETH should maintain support at $2,400 to avoid breaking the upward channel extending to July 2023.
#Ethereum It is testing a key support area at $2,400. If this level holds, we may see… $ Ethereum Aim to reach the upper limit of the channel near $6,000! pic.twitter.com/W8J8WVy5CL
– Ali (@ali_charts) October 26, 2024
Based on the analyst’s trading chart, a successful retest at the identified support zone would allow ETH to rise above the $3,000 mark before seeing a consolidation between $3,350 and $3,750. Next, another price breakout would occur which would push the Ethereum price to the upper end of its upward channel around $6,000, indicating a potential gain of 142% on the current market price of the asset.
However, if Ethereum bulls fail to hold the support at $2,400, the altcoin could fall by 40% to find a new support level at $1,500. To avoid large losses in this high “risk versus reward” situation, Ali Martinez He advised Traders should place a stop loss between $2,150 – $2,300.
A negative Coinbase Premium indicator indicates bearish sentiment for the ETH market
In other news, CryptoQuant Analyst Darkfost He noticed The Ethereum Coinbase Premium indicator is currently at -2 which is very negative. According to Darkfost, this development indicates that US institutional investors or market whales are currently aggressively offloading their ETH holdings.
For short-term traders, this is a strong bearish signal as Ethereum is likely to see a downtrend in the coming days. However, Darkfost notes that longer-term traders may want to exploit this price drop as an ideal accumulation opportunity.
At the time of writing, ETH is trading at $2,473 per unit. While the altcoin may have posted slight gains in the past day, the decline of 6.47% and 6.27% in the last thirty-seven days, respectively, still leaves a lot to be desired by investors. Additionally, Ethereum’s daily trading volume, valued at $12.22 billion, reflects a 48.27% decline representing a decrease in market liquidity and the potential for increased price volatility.
Featured image from Dribble, chart from Tradingview
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