Ethereum Set for a Potential Rally Despite Market Crash

Ethereum has experienced a significant downturn following a global market crash on August 5. The crash impacted Ethereum’s price severely, leading to a loss of the crucial $2,800 support level. According to a recent post by CryptoBullet, this breach also caused Ethereum to violate its previously observed parabola curve, a key technical pattern that had supported its price trajectory.

Despite this setback, there are strong indicators that Ethereum may recover. The Fibonacci retracement levels, a popular technical analysis tool, played a crucial role in stabilizing Ethereum’s price during the downturn. Specifically, the 0.618 Fibonacci level managed to hold the body of the weekly candle, while the 0.5 level caught the price wick. These levels have historically been significant in providing support during market corrections, and their effectiveness here suggests that Ethereum might have found a bottom.

Moreover, Ethereum is still above a critical multi-year support line, which continues to offer bullish sentiment. This long-term trendline has acted as a foundation for Ethereum’s price for several years, and its ability to maintain this support is a positive sign for investors.

The analyst remains optimistic about Ethereum’s future, predicting that the recent low between $2,100 and $2,500 is likely to be an unbreakable support cluster. This price range has historically been difficult to breach, further reinforcing the idea that Ethereum may have reached its lowest point during this downturn.

However, before Ethereum can embark on a significant rally, some consolidation around the 0.618 Fibonacci level and the 100-day moving average (MA100) might be necessary. This period of consolidation could last for several weeks as the market absorbs recent events and investors regain confidence. The potential upside remains strong, with conservative targets set at $7,800 and realistic targets around $10,500. The most optimistic projections even suggest a price of $14,000.

Despite the recent market turmoil, Ethereum shows promising signs of recovery. At press time, Ethereum was trading at approximately $2,635, reflecting a 1.25% increase in the past 24 hours. The 24-hour trading volume exceeded $9.94 billion, a significant 43.05% increase. These figures underline Ethereum’s resilience and potential for a strong recovery.