Will Ethereum make a bullish reversal to $2,500 as ETH price action signals a potential wedge breakout rally ahead?
Ethereum fluctuates near the $1,900 level as Bitcoin holds above $81,000. Notably, Ethereum has recorded a 13% drop in the past seven days.
However, a reversal pattern is emerging on the 4-hour chart, hinting at a potential bounce-back. Could this lead to a new wave of bullish momentum for Ethereum?
Ethereum Price Eyes Wedge Breakout For New Recovery Wave
On the 4-hour price chart, Ethereum is showing a declining trend but gaining momentum. The price drop has breached the 78.60% Fibonacci level, testing a local support trendline.
The support trendline forms a falling wedge pattern on the 4-hour chart, with an overhead resistance trendline. Currently, the bullish reversal from the trendline, accompanied by lower price rejection, struggles to maintain dominance at the 78.60% Fibonacci level.
This crucial Fibonacci level is at $1,897. At present, Ethereum is trading at $1,907, reflecting a 2.04% price surge in the past four hours.
Technical indicators support the chances of a bullish reversal. The MACD and signal lines are on the verge of a positive crossover. Furthermore, the 4-hour RSI line has bounced off from the oversold region.
With a fresh wave of bullish momentum, Ethereum is likely to challenge the overhead trendline, which is close to the $2,000 psychological mark.
Analyst Signals Potential Recovery
With the short-term bounce-back in Ethereum from local support, network activity spiked. According to analyst Ali Martinez, the number of active ETH addresses has jumped 17% in the past 24 hours.
This marks a significant rise from 429,000 to 503,000 active addresses on the Ethereum network. As the number of active ETH addresses grows, this rising activity could lead to additional demand.
The number of active #Ethereum $ETH addresses jumped 17% in just 24 hours, climbing from 429,000 to 503,000! pic.twitter.com/EZLaOwLrEi
— Ali (@ali_charts) March 11, 2025
However, the analyst also highlights a surge in ETH supply on exchanges. Based on data from Santiment, more than 100,000 ETH has been moved to exchanges in the past 48 hours. This has led to a significant supply surge on exchanges, reaching 9.23 million ETH.
Moreover, the analyst points out crucial resistance for Ethereum between $2,248 and $2,610, based on the Global In/Out of the Money indicator from IntoTheBlock.
This resistance zone holds 65.24 million ETH across 12.28 million addresses. Therefore, the short-term recovery in Ethereum will need to surpass this critical level for a sustained recovery.
#Ethereum faces a key resistance zone between $2,250 and $2,610, where 12.28 million investors accumulated over 65 million $ETH! pic.twitter.com/gEPeRTeYFR
— Ali (@ali_charts) March 12, 2025
Ethereum ETFs Record Fifth Consecutive Day of Outflow
As Ethereum’s price remains volatile, U.S. Ethereum spot ETFs recorded a net daily outflow of $21.57 million on March 11. This includes an outflow of $11.82 million from BlackRock and $9.75 million from Fidelity.
The remaining seven ETFs showed no outflow. Since March 5, Ethereum ETFs have experienced five consecutive days of outflows, totaling $181.41 million.
Key ETH Price Targets
While the short-term increase in network activity hints at a potential bounce-back, critical resistances for Ethereum remain. However, the falling wedge breakout rally could trigger a new wave of bullish momentum.
Based on the Fibonacci levels, a breakout from the pattern would likely challenge the 50% Fibonacci level near $2,500. This price level aligns with the key on-chain resistance zone mentioned by Ali Martinez.
On the flip side, a failure to maintain the bullish momentum would likely lead to a retest of the $1,757 support level, close to the local support trendline.
