Ethereum’s Wedge Formation: 2019 vs. 2024
In 2019, Ethereum formed a wedge pattern, characterized by prices making higher lows. This pattern signals potential market instability, as seen in Ethereum's historical performance. Analysts note that the current price structure mirrors past cycles, suggesting possible downturns. Analyst Benjamin Cowen has compared Ethereum’s wedge in 2019 to the current scenario, indicating a possible breakdown similar to the past, potentially leading to a new bottom.
In 2019, the wedge pattern saw Ethereum touch key levels like $81.21, $102.65, $149.31, and $191.37. Before the Federal Reserve's rate cut that year, Ethereum experienced a decline, slipping below the wedge, marking a downturn that ended with a new upward trend beginning.
Fast forward to 2024, Ethereum shows a similar wedge pattern but with higher lows at $886, $1,069, $1,515, and recently $1,954. This pattern's recurrence ahead of an anticipated 2024 rate cut mirrors the 2019 scenario, suggesting Ethereum might break down below the wedge again, leading to further pressure.
Predictions of Further Downside Pressure
Benjamin Cowen predicts Ethereum could hit a new low of $1,200 by December 2024. This forecast draws on historical data from 2016 and 2019, where similar conditions led to a 70% drop. Cowen suggests the $1,200 mark could be a temporary bottom before a market rebound in early 2025. Currently, Ethereum trades at $2,342, implying a potential 48% crash.
Selling Pressure on ETH
Recent whale activities increase bearish sentiment for Ethereum. On-chain data shows a foundation wallet transferred ETH worth about $2.38 million to a multi-signature wallet, following a $94 million transfer to Kraken. These actions by the Ethereum Foundation raise concerns about their impact on Ethereum’s market trajectory.
Disclaimer: This content is informational and should not be considered financial advice. Readers should conduct thorough research before making investment decisions.
