Ethereum is up just over 1% in the last 24 hours. It is still underperforming compared to the crypto market, but has reduced its monthly loss to about 5.7%, while Bitcoin is down over 10% for the month. Despite the slow pace, the price of Ethereum is showing initial signs of strength again.
A notable bullish pattern is forming, whales are increasing their positions and the chart is now close to a level that will determine if this breakout is real.
A well-known pattern is taking shape as whales step in.
Ethereum is forming a 'cup and handle' pattern, a structure that often appears before trend changes. The 'cup' is the rounded bottom from mid-November lows and the 'handle' is the recent retracement. The edge of the pattern is slightly sloping downward, but this does not compromise its validity.
A sloping neckline still works as long as the price continues to respect the cup structure and tests the edge again.
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Just as Ethereum began to move out of the handle, whales increased their positions. Between December 11 and 12, the supply held by whales rose from 100.41 million ETH to 100.50 million ETH.
This is a small but timely addition of 90,000 ETH, worth about $293 million at the current price.
Whale buying during a breakout attempt of a pattern often shows that large holders expect a continuation of the movement. It does not confirm the movement but supports the formation.
A clean breakout requires a daily close above $3,486, which represents the neckline of the pattern. Ethereum is still about 7% below this level.
Ethereum price levels that confirm the breakout.
If Ethereum surpasses $3,486, it confirms the cup and handle structure and activates the calculated target.
Based on the depth of the cup, Ethereum's price target was near $4,779, with a 37% increase from the presumed neckline. Before reaching it, Ethereum would encounter intermediate resistance levels at $3,712 and $4,249.
These areas historically slow down the price, so they act as checkpoints along the way to the full target.
Downward:
The first signs of weakness are seen with a daily close below $3,152, as this would break the handle structure.
The setup is invalidated if Ethereum falls below $2,620, a lower support that marked the bottom of the cup.
At this moment, the trend is cautiously bullish. The pattern is intact, whales are accumulating, and Ethereum is one step away from its breakout line. A 7% movement is still needed to confirm, but the formation is stronger than it has been in recent weeks.
