Ethereum Prepares For Potential Rally To $6,000, Analyst Says

Following a slight price dip on Friday, Ethereum (ETH) has displayed much resilience climbing by 2.84% in the past 24 hours. Commenting on the altcoin’s possible next movements, crypto analyst Ali Martinez has painted a potential trajectory to a new all-time high at $6,000.

In an X post on Saturday, Martinez shares that Ethereum is currently testing a key support level at $2,400. Notably, Ethereum slipped to around $2,410 on Friday and has since remained in this price zone following a recent rejection at $2,500. According to Ali Martinez, ETH must maintain support at $2,400 to avoid breaking an ascending channel that stretches as far back as July 2023.

#Ethereum is testing a key support zone at $2,400. If this level holds, we might see $ETH aiming for the channel’s upper boundary near $6,000! pic.twitter.com/W8J8WVy5CL

— Ali (@ali_charts) October 26, 2024

Based on the analyst’s trading chart, a successful retest at the specified support zone will allow ETH to surge above the $3,000 mark before experiencing a consolidation between $3,350 – $3,750. Thereafter, another price breakout will occur which should push Ethereum’s price to the upper end of its ascending channel around $6,000, indicating a potential 142% gain on the asset’s current market price.

However, If Ethereum bulls fail to hold the support at $2,400, the altcoin could fall by 40% finding a new support level at $1,500. To avoid significant losses in this high “risk to reward” situation, Ali Martinez has advised traders to put a stop loss between $2,150 – $2,300.

In other news, CryptoQuant analyst Darkfost has noted that the Ethereum Coinbase Premium Index is currently at -2 and is highly negative. According to Darkfost, this development indicates that US institutional investors or market whales are currently aggressively offloading their ETH holdings. 

For short-term traders, this is a strong bearish signal as Ethereum is likely to experience a downtrend in the coming days. However, Darkfost states that long-term traders may want to utilize such price decline as a perfect accumulation opportunity.

At the time of writing, ETH trades at $2,473 per unit. While the altcoin might have recorded a minor gain in the past day, a decline of 6.47% and 6.27% in the last seven and thirty days, respectively, still leaves much for investors to desire. In addition, Ethereum’s daily trading volume, valued at $12.22 billion, reflects a  48.27% decline representing a reduced market liquidity and potential heightened price volatility.

Featured image from Dribble, chart from Tradingview