- Ethereum saw an incredibly intense decline yesterday that sent its price plunging to fresh multi-week lows
- This selloff came about in tandem with the flash crash seen by the entire altcoin market, which may have come about due to XRP’s 50%+ one-day decline
- Other major altcoins – like Chainlink – posted massive losses that resulted in deep downwards wicks on their candle charts, likely due to on-chain short liquidations
- ETH is now in the process of recovering from these lows, and it is currently attempting to break back above $600
- Whether it can climb higher could determine if it can post an extremely bullish inverse head and shoulders pattern on its weekly chart
- One analyst notes that a confirmation of this pattern could allow for it to see some extremely bullish price action in 2021
Ethereum’s price action has been rather lackluster as of late, with the cryptocurrency being unable to garner any strength against Bitcoin as its buying pressure remains tempered.
This has caused the entire altcoin market to remain relatively flat, which is a trend that will likely continue until ETH can rally against Bitcoin.
Its underperformance may not last for too much longer, and yesterday’s selloff may have been the final shakeout before it sees further upside.
One analyst spoke about this, pointing to a potentially bullish pattern forming on its weekly chart.
Ethereum Tries to Reclaim $600 as Rebound Gains Steam
At the time of writing, Ethereum is trading up just under 2% at its current price of $593, which marks a notable climb from its recent lows of $550 that were set yesterday.
The buying pressure here was quite intense, and whether or not it can climb higher will depend on its reaction to $600.
A rejection here could spell trouble for its ongoing upswing, whereas a rally past it could allow for it to see significantly further upside.
Trader Claims ETH is Forming a Bullish Pattern Against BTC
Despite its weakness against Bitcoin, one trader is noting that Ethereum could be forming a bullish inverse head and shoulders pattern against Bitcoin. This could give it momentum heading into 2021.
“If ETH bounces here it starts to setup a hell of an inverse head and shoulders on the weekly to enter 2021.”
Image Courtesy of Jonny Moe. Source: ETHBTC on TradingView.
The coming few days will be critical for understanding whether this pattern will result in Ethereum seeing significant upside in early-2021.
Featured image from Unsplash. Charts from TradingView.
