ETH/USD Technical Analysis: Why the Crypto Market May Still Rally

• The cryptocurrency market rebounded in 2023 after a bearish market in 2022.
• Ethereum bounced from the strong $1000 support level on the monthly chart and formed a contracting triangle as a reversal pattern.
• On the short-term perspective, Ethereum is forming a pennant which could lead to another rally.

Cryptocurrency Market Rebound in 2023

The cryptocurrency market experienced a bearish market in 2022 and investors fled due to the US dollar’s strength as well as other factors such as the FTX scandal. However, against all odds, the crypto market rebounded in 2023 with Bitcoin up close to 50%, and Ethereum following suit.

ETH/USD Long-Term View

On the monthly chart, it is notable that $1000 acted as solid support for Ethereum. Round numbers often provide support or resistance and this case appears to be no different.

ETH/USD Medium-Term Perspective

Ethereum consolidated above the mentioned support level on the daily chart and formed a contracting triangle, acting as a reversal pattern when it broke above its upper trendline. This triangle should act an invalidation level for any long trades.

ETH/USD Short-Term View

From a short-term perspective, it appears that Ethereum is forming a pennant which is usually followed by another rally. However, until prices break higher it is difficult to anticipate direction on such small timeframes. Nevertheless, an inverse head and shoulder pattern can also be observed here.

Conclusion

Overall, it appears that Ethereum has found strong support on all timeframes and may continue its bullish trend in the near future if prices manage to break out of their current consolidation patterns or hold onto their current levels of support or resistance.