Ethereum price is rising by 6.7% in the last 24 hours and is currently trading around $3,320. This movement came after the breakout formation confirmed on December 3rd and still points to $3,710.
However, the mixed signals forming now indicate that this rise may take some time.
Breakout Structure is Being Maintained: Bullish Cross is Approaching
Ethereum price continues its movement in the inverse head and shoulders breakout formation that formed in late November. The model is still valid after December 3rd because the $2,710 support on the right shoulder held. Only if ETH falls below this level does the structure weaken.
Currently a significant trigger: a bullish crossover forming between the 20-period EMA (Exponential Moving Average) and the 50-period EMA. EMA indicates a moving average that gives more weight to recent price movements.
A bullish crossover generally indicates that buyers are gaining strength and momentum may continue in that direction. This trigger could lift the ETH price towards the target of $3,710.
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However, this crossover will only occur if sellers do not step in. An on-chain metric shows why caution is warranted.
Paper Profits Create Profit-Taking Opportunities
Ethereum's Net Unrealized Profit/Loss (NUPL) indicator measures the 'paper gains' across all ETH wallets. When NUPL rises, investors have more reasons to sell due to higher unrealized gains.
ETH's NUPL value has currently risen to 0.296, entering the 'Optimism–Fear' zone. This is the highest level seen since the beginning of November.
NUPL last reached a similar level on December 3, and ETH experienced an approximate 5.2% decline within two days as investors took profits.
Currently, a similar picture is striking. As profit rates increase, ETH is trading close to the resistance level. This raises the likelihood that some investors may sell before the bullish crossover is completed. If this scenario occurs, the crossover may not happen and momentum could slow down. Therefore, even if the breakout formation is not disrupted, investors may need to be a bit more patient. This shows why the waiting period may be extended.
Ethereum Key Price Levels: What Opens and Closes the Path at $3,710?
If the bullish crossover is completed and NUPL pressure remains limited, the path for Ethereum's price is becoming clear:
If the 12-hour candle closes above $3,390, the first bullish signal will be received.
The next resistance is located at $3,570.
With the breach of $3,570, a 20% increase measured from the breakout point will be opened up to $3,710.
If sales increase, the structure may weaken. ETH maintains its validity above $2,710, but if it falls below $2,610, the setup will become invalid and the door to a deeper pullback will open.
For now, ETH is caught between two forces: a bullish crossover that could carry it to $3,710 and rising paper profits. Which side will dominate will become clear in the next few sessions.
