Ethereum (ETH) Wave Count Suggests a Long-Term Bottom Has Been Reached

Updated by Geraint Price
In Brief
  • ETH has completed a fourth wave pullback.
  • It has broken out from a descending resistance line.
  • The daily RSI is bullish.
  • promo

    The Only Mobile-Native Layer 1 Blockchain Read Now

Ethereum (ETH) has nearly doubled in price since its June 18 lows. It is possible that a local bottom is in place.

The most likely long-term count suggests that ETH completed a five-wave upward movement (white) between March 2020 and Nov 2021. Afterward, it seems to have completed an A-B-C corrective structure. 

In the longer-term, the aforementioned increase was likely part of wave three (red), while the ensuing correcting part of wave four, which in turn developed into a fourth-wave pullback (red). 

If the count is correct, the price has begun a new upward movement that will eventually lead to a new all-time high price. In order for the count to be confirmed, Ethereum has to move above the wave one low (red line) at $2,159.

Ongoing ETH breakout

The daily chart also provides a bullish outlook, since it shows that the price has already broken out from a descending resistance line that had been in place since April 5. Additionally, the daily RSI has moved above 50 (green icon), in what is considered a sign of bullish trends. 

If the previously outlined count is correct, ETH is currently in wave one of a new five-wave upward movement (white). The sub-wave count is given in black. 

The most likely area to act as the local top is between $2,230 and $2,540. It is created by the short-term 0.5-0.618 Fib retracement resistance area (black) and the long-term 0.382 retracement resistance.

Short-term movement

Finally, a closer look at the previously outlined sub-wave count shows that ETH is likely in wave three of a five-wave upward movement. So far, sub-wave three has had 1.61 times the length of sub-wave one, which is common in such structures. 

As a result, a short-term drop could follow prior to the fifth and final sub-wave. 

The possibility of a drop is also supported by the six-hour RSI, which has generated bearish divergence (green line)

For Be[in]Crypto’s latest Bitcoin (BTC) analysis, click here


All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.