The Ethereum price chart has literally been ranging and trading sideways all through this week.
This sideways trading has created a key pattern in the 1-hour timeframe, and this key pattern is very important because it might help us understand what we can expect next from the Ethereum price chart in the coming days.
In this Ethereum analysis, we will be breaking down this Bearish Pennant Pattern currently forming in the ETH 1-hour timeframe and what it might mean for the Altcoin price in the coming days.
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Ethereum Bearish Pennant Pattern
The Bearish Pennant Pattern is a Bearish continuation pattern that forms when price consolidates after a large initial drop.
For Ethereum, this initial drop in price happened all through last week when we experienced a massive sell-off across the crypto market. What we are seeing play out right now, is a slight consolidation in price before the sell-off resumes.
This consolidation is what is currently forming the Pennant Pattern for Ethereum in the 1-hour timeframe.
However, this pattern is still yet to be completed and therefore not ready to be traded yet.
For this ETH bearish pennant pattern to be completed, we need to see the Ethereum price break and close below the pattern in the 1-hour timeframe.
A bearish break and price close below this pattern is the confirmation we need to indicate that the Ethereum sell-off might just have resumed and we can expect the ETH price to head lower in the coming days.
Bearish Target For This Pennant Pattern
If this bearish Pennant Pattern plays out, there is a very high probability that we might see the ETH price drop back to the previous lows of $1,715 in the coming days.
This $1,715 price level is also a key region of major support in the higher timeframe so it makes it the best target for a bearish move like this.
But for this Ethereum move lower to be confirmed, the Ethereum price must first breakthrough and close below this Bearish Pennant pattern in the 1-hour timeframe.
Until a breakdown like this occurs, this pattern will remain a low probability trade setup. And as professional traders, we only look for high probability setups to trade.
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