Ethereum (ETH/USD) has recently formed an *inverse head and shoulders* on the 1-hour timeframe, a classic bullish reversal pattern. The left shoulder, head, and right shoulder have completed their formation, with the “neckline” roughly around the $2,400–$2,450 region. A decisive break and close above this neckline could indicate a shift in momentum favoring buyers.
From a technical perspective, the *measured move* suggests a possible climb toward the $3,000 zone. This level is derived by measuring the distance from the “head” low to the neckline, then projecting that same distance upwards from the breakout point.
Before ETH makes a full run at $3,000, price may retest the neckline area as new support. Such a pullback is normal in this kind of setup, allowing traders to confirm the breakout’s validity. If the neckline holds, it would further cement the bullish bias and provide a potential buying opportunity.
Momentum Indicators
Looking at momentum oscillators (like the Stochastic at the bottom of the chart), we see signs of *overbought* or *cooling-off* conditions, which could hint at a short-term pullback. Nevertheless, a retest of the neckline combined with a reset in momentum indicators could open the door for the next leg higher.
Key Levels to Watch
• Neckline/Support: $2,400–$2,450
• Upside Target: Around $3,000
• Potential Failure: A sustained drop below the right shoulder (around $2,300) could invalidate the bullish scenario.
Strategy
• Aggressive Entry: Consider entering on a confirmed breakout above the neckline with strong volume.
• Conservative Entry: Wait for a pullback to the neckline and look for bullish confirmation (e.g., a bullish candlestick pattern, bounce in volume) before entering.
• Risk Management: A stop-loss below the head (or below the right shoulder) can help limit downside if the pattern fails.
The inverse head and shoulders points to a bullish reversal for ETH/USD, with a potential journey toward the $3,000 zone. However, traders should remain cautious of possible retests or short-term pullbacks, particularly if momentum indicators continue to cool off. Stay vigilant, manage risk appropriately, and remember that market conditions can change rapidly.
From a technical perspective, the *measured move* suggests a possible climb toward the $3,000 zone. This level is derived by measuring the distance from the “head” low to the neckline, then projecting that same distance upwards from the breakout point.
Before ETH makes a full run at $3,000, price may retest the neckline area as new support. Such a pullback is normal in this kind of setup, allowing traders to confirm the breakout’s validity. If the neckline holds, it would further cement the bullish bias and provide a potential buying opportunity.
Momentum Indicators
Looking at momentum oscillators (like the Stochastic at the bottom of the chart), we see signs of *overbought* or *cooling-off* conditions, which could hint at a short-term pullback. Nevertheless, a retest of the neckline combined with a reset in momentum indicators could open the door for the next leg higher.
Key Levels to Watch
• Neckline/Support: $2,400–$2,450
• Upside Target: Around $3,000
• Potential Failure: A sustained drop below the right shoulder (around $2,300) could invalidate the bullish scenario.
Strategy
• Aggressive Entry: Consider entering on a confirmed breakout above the neckline with strong volume.
• Conservative Entry: Wait for a pullback to the neckline and look for bullish confirmation (e.g., a bullish candlestick pattern, bounce in volume) before entering.
• Risk Management: A stop-loss below the head (or below the right shoulder) can help limit downside if the pattern fails.
The inverse head and shoulders points to a bullish reversal for ETH/USD, with a potential journey toward the $3,000 zone. However, traders should remain cautious of possible retests or short-term pullbacks, particularly if momentum indicators continue to cool off. Stay vigilant, manage risk appropriately, and remember that market conditions can change rapidly.
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Note
Still active, stop loss not hitTrade closed: stop reached
Stop loss hit at 2070 2 days back
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.