Ethereum (ETH) has been attempting to break free from the resistance zone at $2,800, a barrier it hasn’t surpassed since August. While its recent climb has been steady, Ethereum’s ascent has lacked the explosive momentum often expected in bullish breakouts, fueling speculation about whether it can hit new highs in the coming weeks.
ETH’s Slow Ascent And The Case For Accumulation
Over the past few months, Ethereum’s price has inched higher in what analysts consider a promising, yet gradual buildup. Since September, ETH has been forming a pattern of higher lows, which, despite its slow pace, suggests a sustained demand from buyers. According to recent exchange data, negative netflows indicate that investors have been accumulating ETH rather than selling, a bullish sign suggesting confidence in future price gains.
However, a few factors cast doubt on whether this accumulation will be enough to break Ethereum past its $2,800 resistance and into a full-fledged bullish run. While Ethereum’s gradual ascent has encouraged long-term holders, there is still uncertainty around whether it will be enough to push prices past this three-month high.
Ascending Triangle Pattern Promises Potential Breakout to $3,300
Ethereum’s price movement over the past several weeks has formed an ascending triangle pattern—a bullish signal that usually implies a potential breakout. Technical analysts note that a daily close above $2,800 could pave the way for ETH to surge toward $3,350. This price target is significant, as breaking through it could invite further buying pressure and cement ETH’s next upward leg. The On-Balance Volume (OBV), a key indicator of buying and selling pressure, has been slowly trending upward, showing modest demand.
However, it’s worth noting that the OBV remains below the levels seen in June and July, suggesting that while there is buyer interest, it may not be robust enough for a massive breakout. The lukewarm demand, combined with current market conditions, indicates that any upward movement to $3,300 may be a slow journey rather than a rapid spike.
Technical indicators reveal a mixed landscape for Ethereum’s price trajectory. The Relative Strength Index (RSI), though tilted bullish, has not provided a clear trend signal this October. Similarly, the Directional Movement Index (DMI) indicates weak momentum, with the Average Directional Index (ADX) currently falling below the 20 level, typically a sign of a lack of trend strength.
While these indicators aren’t signaling a bearish reversal, they also don’t lend strong support to a bullish breakout. The possibility of a minor retracement toward $2,500 remains on the table, especially if buyers fail to maintain current price levels.
Lower Timeframe Data – Bullish Sentiment but Limited Volume
On the shorter timeframes, Ethereum has shown some promising signs. Open Interest—an indicator of the total number of open derivative contracts—has been rising, suggesting heightened trading activity and bullish sentiment. Over the past three days, Open Interest has trended upward alongside Ethereum’s price, indicating renewed interest in ETH among traders.
However, the spot Cumulative Volume Delta (CVD), which measures spot market demand, has not seen a comparable rise, even though ETH has climbed by over 9% since October 26. This lack of strong spot market demand raises questions about the stability of Ethereum’s price gains. Without substantial support from the spot market, there is a risk that ETH’s current rally may not sustain momentum.
Also Read: The Case For Ethereum – How 543,000 ETH Withdrawn From Coinbase Signals Bullish Potential
Ethereum’s path to $3,300 remains promising but cautious. Breaking the $2,800 resistance is critical to maintaining bullish momentum. For this breakout to gain traction, ETH would ideally see higher volume and more robust spot market demand. While the ascending triangle pattern and recent accumulation signal an underlying bullish sentiment, the lukewarm indicators suggest a slow and possibly challenging journey to new highs.
In summary, Ethereum’s technical indicators reveal a mixed bag: bullish formations are in place, but volume concerns and modest demand cast doubt on the potential for a quick breakout. Traders and investors will be watching closely, as a confirmed close above $2,800 could provide the boost ETH needs to climb toward $3,300. Until then, Ethereum’s progress may remain steady but cautious, awaiting a decisive signal from the market.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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