Market expert Peter Brandt has highlighted a head and shoulders pattern on the Ethereum chart, indicating a higher likelihood of price drops from the current level. This revelation comes as Ethereum experiences a correction following a broader market decline. Despite a recent surge that saw Ethereum retest the critical $3,900 mark on June 5, bearish sentiment has taken over, pushing the price down to the lower end of the $3,500 range.
In the midst of this price decline, Ethereum’s uptrend remains intact, according to chart data. However, Brandt’s identification of the head and shoulders pattern suggests a potential reversal towards the downside. This pattern typically consists of three price peaks, with the middle one being higher than the first and last, signaling an impending drop. Ethereum breached the neckline of this pattern at $3,501 today, indicating a possible continuation of the downward trend.
If the head and shoulders pattern holds true, Ethereum could see further price declines as momentum indicators weaken. The Relative Strength Index (RSI) has plummeted to 44, confirming strong selling pressure and a bearish push. Additionally, in the derivatives market, Ethereum has witnessed a surge in volume and a decrease in long positions, with traders betting on further declines.
As of the latest data, Ethereum is trading at $3,529, down 3.8% in the past 24 hours. Analysts warn of potential further drops in the short term if selling pressure persists. It is important to note that this information is for educational purposes only and should not be considered financial advice. Readers are advised to conduct their own research before making any investment decisions.