Ethereum price is traversing a bullish setup on a short-term outlook, suggesting a breakout to the upside soon. Interested investors can be patient and capitalize on the next leg-up that will push ETH to $3,200 and higher, especially if the bulls support it.
Ethereum price to take off soon?
Ethereum price is inside a descending parallel channel and has been for exactly a month. Within this time frame, ETH has set up three distinctive lower highs and four lower lows, which when connected using trend lines, show a descending parallel channel.
As ETH retests the upper trend line for the third time there is a good chance for a breakout to occur in the next couple of days. However, there is likely to be a minor retracement to the $2,880, which will be a buying opportunity for interested investors.
Even beyond this support floor, there is another one at $2,763, which will be the make-or-break point for the long setup we are hunting.
A clean break above the channel’s upper trend line at roughly $2,975 will denote a breakout. In such a case, the technical formation setup forecasts a move equal to the width of the channel. Adding this measure reveals a target of $3,262, which will be our take-profit level.
Therefore, investors can capitalize on the 13% upswing that is yet to originate. However, the $3,197 hurdle could cut this run-up short, so buyers must be aware of this blockade.
In a highly bullish case, Ethereum’s price could shoot up to $3,584, bringing the total gain to 24%. Although unlikely, the best-case scenario could propel ETH to $4,000, constituting a 38% ascent.
Source: TradingView
Adding a tailwind to this long scalp idea for Ethereum price is the 30-day Market Value to Realized Value (MVRV) model. This indicator is primarily used to gauge the sentiment of holders as it tracks the average profit/loss of investors who purchased ETH tokens over the past month.
While a negative value indicates that these holders are underwater and are less likely to sell, a positive value indicates that holders are in profit, and the risk of a sell-off is high. Santiment’s backtests show that -10% to -15% is where long-term holders accumulate, leading to a local bottom formation. Therefore, the aforementioned range is termed an ‘opportunity zone,’ since the risk of a sell-off is less and it is a good place to buy.
Currently, the 30-day MVRV is hovering close to 0%, but the local top is formed at around 15%, which reveals that there is more to move up north. Hence, supporting the technical perspective’s bullish forecasts.
Source: Santiment
