The Ethereum (ETH) price reached a new yearly high on April 5. The weekly and daily time frames both look bullish.
The ETH price has increased at an accelerated rate since March 10. On March 17, it broke out from the $1,700 area and was validated as support ten days later.
During this movement, the daily RSI broke out from its bearish divergence trendline and moved above 50. Both these indicate a bullish trend and support the continuation of the increase.
Moreover, the ETH price has traded in a massive ascending parallel channel since June 2022. While the channel’s support and resistance lines have not been validated sufficiently, the channel’s midline has acted as resistance several times (green circle), granting validity to the pattern.
The ETH price broke out from the channel’s midline on April 4 and increased significantly over the next 24 hours. If the increase continues, the price could reach the resistance line near $2,400.
Next week is expected to bring some positive Ethereum news in the form of the much-anticipated Shapella Upgrade, which will finally allow validators to withdraw their staked ETH. This is the second major Ethereum network upgrade since the release of Ethereum 2.0.
Ethereum (ETH) Price Long-Term Outlook Supports Increase
The technical analysis from the weekly time frame indicates that the trend is bullish. In March 2023, the ETH price broke out from a descending resistance line that had been in place since the all-time high. Breakouts from such long-term structures often precede significant price increases.
Moreover, the weekly RSI just moved above 50, supporting the continuation of the increase. Excluding a small deviation in March 2022 (red circle), the previous time the RSI moved above 50 was in April 2020 (green circle), preceding an upward movement of 2800%.
However, the ETH price has yet to break out from the $1,940 horizontal resistance area. If the upward movement continues and the price closes above $1,940, it could move toward the next resistances at $2,440 and $3,400, created by the 0.382 and 0.5 Fib retracement resistance levels respectively. Since the former coincides with the previous channel’s resistance line, it is more likely to act as a local top.
To conclude, the most likely ETH price forecast is a breakout from the long-term resistance at $1,940, followed by an increase toward $2,440. This bullish forecast would be invalidated with a close below the current channel’s midline. In that case, ETH could fall to $1,700.
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