Note that the price of Ethereum has traded relatively steadily over the past week, with slight movement despite ongoing expectations. At first glance, it seems like nothing is happening. However, the chart and on-chain data together present a completely different picture. A clear breakout structure is currently forming, and at the same time, the selling pressure from long-term holders has collapsed.
This accumulation represents a rare case. If it continues, the next big move for Ethereum may already be in progress.
The breakout of the inverted head and shoulders pattern aligns with a sell-off on-chain.
The daily chart shows that Ethereum is forming a well-defined inverted head and shoulders reversal pattern. The neckline of this pattern is almost flat near the $3,400 area, which is significant. Flat necklines typically attract greater continuity when the price is decisively broken.
If Ethereum closes decisively above this neckline (around $3,400), it shows that the targeted move according to the confirmed pattern indicates a target close to $4,400. This target comes directly from the height of the head when projected upwards. From a technical perspective, this formation looks clear.
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This model's importance is increased by what happens on-chain.
The net position change indicator calculates whether long-term Ethereum holders are selling or accumulating more. Since November 26, this indicator has changed significantly. At that time, long-term holders were selling about 1,100,000 eth. By December 23, this number had dropped to only 54,427 eth.
This represents a decline of over 95% in selling pressure.
The importance lies in the fact that long-term holders typically reduce selling near significant turning points. When a breakout pattern forms simultaneously with a sell pressure collapse, it indicates that supply is being depleted rather than increasing. This builds a stronger base for any upward movement above the neckline.
The signal simply indicates a breakout, and on-chain data shows there are fewer sellers standing in the way.
Cost basis levels and key areas for Ethereum's price.
Wonder if Ethereum can realistically reach and break the neckline.
Cost basis data contributed to answering this question. Cost basis data clarified the places where large amounts of eth were last purchased. These areas often act as resistance when prices return to them, as holders may sell near breakeven.
For Ethereum, the most significant cost basis accumulation lies between about $3,150 and $3,173. Approximately 2,940,000 eth have accumulated within this range. This made it the strongest barrier on the way up.
Continuous movement above this range facilitates the path toward the neckline at $3,400. Such levels currently represent approximately a 7% advance. Note also that the $3,150 level appears on the price chart, confirming its significance.
Upon surpassing $3,400, the next main level was near $3,480, followed by a relatively weak resistance range until around $4,170.
If momentum builds after the breakout, the target of the complete inverted head and shoulders is close to $4,400 within reach.
Risk continued to be well-defined. If Ethereum loses $2,800, the structure weakens. If it falls below $2,620, the bullish formation is completely invalidated, indicating that sellers have regained control.
The balance is currently tilted in favor of the bulls. The confirmation of the classic reversal pattern, the sharp long-term sell-off, and the clarity of the resistance map all point to the same conclusion. However, the bullish theory clearly relies on a clean close above the $3,150 level, which is a breakout wall area.
