A key technical chart formation suggests that Ether’s (ETH) price is about to break out toward new all-time highs. Can Ether flip the $4,000 psychological mark into support?
ETH price chart pattern hints at potential breakout
Ether price rose over 27% over the past week, flipping key resistance areas into support.
Following its price rally, Ether has broken out of its falling wedge chart formation, a pattern that indicates a potential reversal from the previous downward trend.
The breakout could signal a rally to new all-time highs, according to pseudonymous crypto trader Jelle, who wrote to his 83,000 followers in a May 27 X post:
“$ETH broke out from the falling wedge, then flipped key areas into support & now pushes for $4,000. New highs and new all-time highs are next.”
The falling Bitcoin (BTC) dominance also suggests that traders’ attention is rotating toward Ether as the ETH/BTC pair has bounced in the past few days. Bitcoin’s dominance fell over 0.98% during the past five days, while Ether's dominance rose 4.4%.
Over the past 24 hours, Ether dominance rose 1.45% while Bitcoin dominance fell 0.57%, according to TradingView.
ETH price needs to close week above $3,956 — analyst
Most of Ether’s current price rally can be attributed to positive developments around the first spot Ether exchange-traded funds (ETFs).
On May 20, Ether price rose nearly 20% within a day, following reports that the United States SEC has U-turned on spot Ether ETFs — possibly due to political pressure — with reports stating it has asked ETF exchanges to update their 19b-4 filings.
Adding to the positive investor sentiment, Ether price could rally to the $4,500 mark before the first spot Ether ETFs start trading, according to Arthur Cheong, the founder and CEO of crypto-focused investment firm DeFiance Capital.
In a May 26 X post, Cheong wrote to his 167,000 followers:
“4.5k before spot ETF goes live for trading [in my opinion].”
However, Ether’s price faces significant resistance at the $4,000 psychological mark. A potential move above $4,000 would liquidate over $433 million worth of cumulative leveraged short positions across all exchanges, according to CoinGlass data.
Ultimately, ETH price needs a weekly close above the $3,956 mark to confirm sustained bullish momentum, according to popular crypto analyst Rekt Capital, who wrote in a May 26 X post:
“Ethereum just needs to Weekly Close above $3956 (green) to move into $4000+ territory. At the moment, #ETH is forming a Lower High.”
