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In our previous Ethereum analysis Why This Ethereum Rally Could Be A Bull Trap! Watch These Key Levels, we talked about the converging triangle pattern currently forming on the Ethereum 4-hour timeframe and how this pattern could affect the ETH bullish rally we were witnessing then.
If this bearish move plays out, this could be a -16% dump in the value of Ethereum in the coming days.
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Key Levels To Watch!
Fast forward the price action to right now and what we are seeing on the Ethereum 4-hour timeframe is that converging triangle pattern key resistance holding strong and getting ready to push the ETH price back lower.
The most important key level to watch is the Converging triangle pattern resistance. For this bearish prediction to play out, the Ethereum price must continue to trade below this pattern resistance on the 4-hour timeframe.
By respecting this key level, the Ethereum price would give us the perfect look we need for a valid converging triangle pattern.
Bearish Target For This Sell-off!
The bearish target for this price sell-off would be the base of the converging triangle pattern on the 4-hour timeframe.
There is a very high probability that we will see the Ethereum price sell-off to this key region before finding support and bouncing back up in the coming days.
This would be a -16% drop in price and can play out within the coming days for Ethereum.
Does This Mean Ethereum Is Now In A Bearish Trend?
For the short term: Yes.
But for the long term, we are still in a ranging market, trading within a converging triangle pattern that is still developing on the 4-hour timeframe.
And the price will keep on ranging like this until the pattern is completed and Ethereum finally breaks out of it either to the upside or downside.
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