Ethereum price has just broken through its all-time high! Why caution is still advisable
The Ethereum price has just broken through its old all-time high and is thus making history once again. Nevertheless, there is reason to be critical of the whole thing. We will now explain why.
The Ethereum price has just broken through its former all-time high of $1,457 and is currently trading at $1,490. With this, the number 2 cryptocurrency may be giving the starting signal for the next Crypto Cash market rally. The $2,000 mark is within reach. Last week, we already talked about 3 compelling reasons for this.
However, there is a price pattern that calls for prudence. We are talking about an ascending wedge.
Ethereum price on the 6H chart in an ascending wedge formation.
This formation is characterised by its two upward sloping trendlines and bearish volume during its formation. However, at 24%, the formation has a high failure rate. However, this still means that a downward breakout occurs in 76%. Accordingly, this formation should not be ignored.
It will be important for the Ethereum price to convert the former resistance line at just under $1,450 into support. Should this succeed, nothing will stand in the way of the Ethereum price and its next price target of $2,000.
Possible correction could hit Ethereum price hard
But what if the Ethereum price cannot convert the trendline into support? What if the price per ETH would even close below it at the end of the day?
In that case, we can assume that ETH could become part of a larger market correction, which we have already pointed out in a Bitcoin price analysis.
The chart formation even allows us to calculate a price target for the Ethereum price. The so-called minimum price target is derived from the low point of the formation. In the case of Ethereum, this is just over $900. Statistically, however, this is only reached in 63% of cases, so that the psychological limit of $1,000 would probably be the more likely price target in this case.
But of course this only applies if there is a downward breakout at all. For this to happen, the Ethereum price would first have to close its daily price below $1,300, and at the moment it does not look as if the ETH bulls are in the mood for that.