Has Ethereum Bottomed Out Locally?

In the past fortnight, Ethereum has seen a significant dip of nearly 20%, plummeting from around $2,805 on February 23 to slightly above $2,200 at the current time of reporting, erasing $80 billion from its market cap.

Despite this drastic downturn, cryptocurrency analysts are identifying numerous bullish indicators that could foretell an imminent price rebound. Notably, crypto analyst Merlijn The Trader has illustrated that ETH is tracing the Wyckoff Reaccumulation Pattern.

For those not in the know, the Wyckoff Reaccumulation Pattern is a technical analysis model devised by Richard Wyckoff. Within the framework of ETH’s recent price dynamics, this pattern intimates that the asset may be in the accumulation stage prior to a likely upward shift.

The analyst further observed that the “spring phase” has recently been initiated, hinting at a possible bear trap where a temporary dip below support levels confuses sellers, potentially priming the stage for a rally. A rebound from this point could propel ETH towards the $4,000 mark.

In another post, Merlijn The Trader also identified a bullish divergence in Ethereum’s 4-hour chart. According to the analyst, ETH’s next immediate target is $2,700 before advancing further. This sentiment is supported by fellow crypto analyst CryptoGoos.

Apart from technical indicators, whale activity has boosted the bullish mood surrounding ETH. Crypto analyst Ted noted in a post, “Ethereum whale bought 17,855 ETH worth $36,000,000 at an average price of $2,054. Total holding $2,530,000,000 Ethereum. You think this is going down? Think again.”

On the bearish side, crypto analyst Ali Martinez noted that the ETH reserves on exchanges have been consistently increasing. Over the past two weeks, more than 610,000 ETH has been moved to exchanges, which could amplify selling pressure.

Martinez’s evaluation is consistent with a recent report that found despite ETH’s Relative Strength Index (RSI) being at a multi-year low, there could still be more downward pressure in store for the digital currency. ETH has been marked by significant bearish sentiment due to its relatively weak price performance over the past two years compared to cryptocurrencies like Bitcoin (BTC), Solana (SOL), and XRP.

However, extreme bearish sentiment could act as a contrarian signal, setting the stage for a surprise rally. At the time of publication, ETH is trading at $2,200, up 6% in the last 24 hours.

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