We believe the Ethereum sell-off is nearing an end, and the key pattern we are currently watching that supports this bullish bias is the Inverse Head and Shoulder Pattern currently forming on the 4-hour timeframe.
But for this pattern to be completed and valid for trading, we need to see the price of Ethereum break and close above the Neckline Region of the pattern.
And as of the time of publishing this article, that Neckline region of the pattern is yet to be broken (which means this bullish reversal pattern has not been confirmed yet).
Instead, we are seeing price sell-off rapidly from this Neckline region as ETH sellers are holding on to this resistance and not letting go.
But that might all change soon!
Right now Ethereum is trading around major Daily support and might be bouncing back up very soon!
In this Ethereum analysis, we will be talking about this key support and why it is so important to the ETH bulls.
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Ethereum Trading At Major Support!
The key level we are watching is the $2,672 Daily support on Ethereum. This support is so important because it was at this key level the Ethereum price bounced and began the bullish rally that played out all through last year.
That rally saw Ethereum going up more than 84%, ending the bearish market we were experiencing back then.
The big question traders are asking now is will this $2,672 Daily support hold the price again?
What Happens If This $2,672 Daily Support Holds?
In the coming days, all eyes will be on the $2,672 Ethereum daily key support to see how the price would react to this key level.
If this support holds, we can expect to see massive bullish pressure come back into the Ethereum market, potentially pushing the price above the Neckline region for Inverse Head and Shoulder and kick-starting the bullish rally for 2022.
So this is very important to keep an eye on especially if you want to get a prime entry for the bullish rally in Ethereum.
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How To Trade The Inverse Head and Shoulder Pattern
For a complete breakdown on how we will be trading the inverse head and shoulder pattern, check out our previous analysis Must Read: Ethereum Forming Massive Inverse Head And Shoulder Pattern!
We talk about the bullish reversal pattern, the key levels to watch, and what it means for Ethereum in the coming days. We also break down what must happen for it to be valid and tradeable.
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