Key Insights:
- Ethereum (ETH) breaks above $1,900, showing bullish strength.
- Whale moves and reduced exchange supply support upside.
- Chart patterns point to $2,700–$4,000 price targets.
Ethereum price has climbed past $1,900, signaling intense price action. Market momentum has also improved, reinforcing its bullish trend.
Technical indicators and whale activity support a continuation toward higher levels, including a longer-term target near $4,000.
Ethereum Price Breaks Key Resistance With Bullish Divergence
Ethereum price has broken out of a downtrend and trades above the $1,900 level daily. Market analyst JavonTM1 highlights a bullish divergence between price and RSI.
This divergence has helped drive a reversal from recent lows, signaling strength in Ethereum’s trend. While the price had made new local lows earlier this year, the RSI steadily formed higher lows.
This divergence often signals weakening selling momentum and rising buying strength. It has historically preceded trend reversals across many asset classes.
If this trend persists, the ETH price could climb back to the $4,000 region. These levels were last seen in late 2021 and early 2022, marking a potential return to previous highs.
Falling Wedge Breakout Projects Further Upside
The current chart and recent patterns both support a bullish outlook. Ethereum price recently hit a breakout of a falling wedge pattern on the 1-day chart.
This technical pattern is recognized for its strong bullish reversal traits. It developed over several months, from early January to late April, reinforcing the trend shift.
Ethereum price reached a 5% increase in a session and breached $1,900. The wedge structure’s projected target price is nearly $2,700.
Traders watch the $2,000–$2,150 range as a critical zone. This level may act as a temporary consolidation point before Ethereum moves higher.
The daily RSI was at 64.11, nearing the overbought threshold of 70. This suggests strong upward momentum in price action.
The Money Flow Index indicates substantial capital inflow. The Cumulative Volume Delta confirmed strong positive demand, reinforcing bullish sentiment.
Whale Activity Points to Strong Accumulation
Large investors continue to purchase Ethereum, which is driving up institutional demand for the cryptocurrency. Heka Funds, or Abraxas Capital Management, withdrew 33,035 ETH worth $60 million.
This transaction was made from Binance and Kraken, as reported by Lookonchain’s on-chain data. These transactions suggest a reduced willingness to sell. They indicate a preference for holding through upcoming market cycles.
Apart from this, another whale later reported that it had bought 1402 ETH, worth approximately $2.56M. After two months of inactivity, buyer satisfaction with Ethereum’s future price was evident, as the purchase occurred.
These actions of whales are one part of a larger trend. The amount of Ethereum available in centralized exchanges keeps decreasing.
Glassnode statistics show that the ETH balances on exchanges have reached their lowest levels in nine years. The continuous shrinkage in liquid supply may help prevent selling pressure and, in turn, increase prices as the demand increases.
Short Squeeze Risk Adds Upward Pressure
In addition to whale accumulation and strong technical setups, order book data shows heavy sell-side liquidity around the $1,850 level. The heatmap chart displays a cluster of potential stop-loss and liquidation zones for short positions.
As the Ethereum price moves into this zone, it could trigger a short squeeze. This sharp price surge would result from forced buybacks of short positions, amplifying upward momentum. This dynamic could accelerate ETH’s move toward higher levels quickly.
A short squeeze arises when traders expecting the prices to go down are surprised by rising prices. As the price increases, they must buy back what they sold to avoid bigger losses. Such an additional purchase further increases the price.
Disclaimer
In this article, the views, and opinions stated by the author, or any people named are for informational purposes only, and they don’t establish the investment, financial, or any other advice. Trading or investing in cryptocurrency assets comes with a risk of financial loss.
Olivia Stephanie is a FinTech enthusiast with a keen understanding of financial markets. Her passion for economics and finance has led her to explore emerging blockchain technology and cryptocurrency markets.