Ether may take a lot of bears by surprise next month, with a deepening correction in September that could completely “invalidate” by the time October comes around.
“It might look bearish at first, but if it plays out, it could be the biggest bear trap I’ve ever seen,” full-time crypto trader and analyst Johnny Woo said on Monday.
He added that the charts could paint a head-and-shoulders pattern in September “to spook everyone,” then invalidate it in “Uptober.” This would trap paper-handed traders, forcing them to buy higher.
“We’ve seen this before plenty of times, so it’s definitely possible,” he added.
The scenario would see Ether (ETH) falling back to support levels at around $3,350 in September before recovering in October and powering to a new all-time high in November.
Something similar happened in September 2021 when ETH fell 30% from $3,950 to $2,750 before recovering to print an all-time high in November.
Potential ETH head-and-shoulders pattern. Source: Johnny Woo
A fall to support looks likely, another analyst says
Fellow trader “Daan Crypto Trades” echoed that sentiment, stating on X that ETH has just been “chopping everyone up” as it has been consolidating in the middle of the range around the $4,300 to $4,500 area.
He said a retest of the range lows and four-hour 200 moving average trend line, which is around $4,160, would be “an interesting spot.”
Related: Ether’s August rally could lead to September downtrend, history suggests
Focus on fundamentals
Apollo Capital’s chief investment officer, Henrik Andersson, was a little more skeptical of technical indicators and the historically bearish September and chart patterns.
“My view is that it’s generally more prudent to focus on fundamental analysis rather than relying on what can often be spurious historical patterns,” he told Cointelegraph.
“While past trends can sometimes offer insights, they shouldn’t be the primary basis for making predictions about market movements, especially in a dynamic and evolving space like cryptocurrency.”
“Macro events like US jobs data (out this Friday) and the Fed’s upcoming rate decision will likely bring short-term volatility, but the real story is structural,” OKX Singapore CEO Gracie Lin told Cointelegraph.
She added that stablecoin growth and regulations are providing more clarity, “and Ethereum powering most of these flows, long-term growth will come from how these rails interconnect — regardless of this month’s news cycle.”
Ether still correcting
ETH remains in retreat, losing a further 1% over the past 24 hours.
The asset fell to an intraday low of $4,238 before recovering to trade at $4,374 at the time of writing. It is currently down 11.7% from its all-time high, which is much shallower than previous September pullbacks.
ETH prices are trending down with lower highs and lower lows. Source: TradingView
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