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Introduction
Ethereum has staged a decisive recovery above crucial support levels after a brief breakdown, with technical analysts pointing to multiple bullish signals that could propel the cryptocurrency toward significant price targets. Following an 8% 24-hour gain that pushed ETH back toward $4,150, traders are watching a recurring pattern that historically precedes sharp rallies, while institutional buying pressure and historical cycle comparisons suggest the foundation is being laid for a substantial upward move.
Key Points
- ETH reclaimed the $3,650 support zone after a false breakdown, following a recurring pattern that has previously led to sharp recoveries
- Coinbase Premium Gap hit +6.0, indicating strong U.S. institutional buying pressure during the recent market correction
- Multiple analysts compare current ETH structure to the 2016-2017 cycle, suggesting potential for a steep multi-month rally ahead
Technical Pattern Points to Potential Rally
Ethereum’s recent price action has followed a familiar script according to technical analyst Trader Tardigrade, who identified a recurring pattern of false breakdown, support reclaim, and subsequent rally. The pattern repeated itself as ETH reclaimed the $3,650 support zone after briefly breaking below this critical level. This exact sequence has occurred multiple times over the past year, with each instance leading to a sharp recovery that typically surpasses previous highs.
The current setup suggests Ethereum could be poised for a move back toward the $4,800 level if current momentum continues. Trader Tardigrade’s analysis shows that after reclaiming support following a false breakdown, ETH has historically rallied above previous resistance levels. This pattern recognition comes as ETH shows resilience despite being down more than 8% over the past week, indicating potential strength beneath the surface volatility.
Long-Term Targets and Institutional Accumulation
Investor Mike Investing has projected an even more ambitious long-term price target of $7,000 by May 2026 based on weekly chart analysis. His assessment shows ETH trading well above its 200-week moving average near $2,447, a level that has historically served as a foundation during previous market cycles. This technical foundation, combined with alleged institutional accumulation, creates a compelling bullish case.
According to Mike Investing’s analysis, major financial institutions including BlackRock, BitMine, and Vanguard increased their ETH holdings during the recent correction, though this activity hasn’t been confirmed in public filings. The suggestion of institutional accumulation during market weakness aligns with historical patterns where sophisticated investors use price dips to build positions, potentially creating a strong support base for future appreciation.
Adding to the bullish technical outlook, analyst Mister Crypto has drawn parallels between Ethereum’s current structure and its 2016-2017 cycle. The side-by-side comparison shows both charts experienced a breakout followed by a short pullback, with the earlier cycle leading to a steep multi-month rally. While fractal analysis serves as a rough guide rather than a guarantee, the historical precedent provides additional context for current price action.
On-Chain Signals Confirm Institutional Interest
Concrete evidence of strong U.S. institutional demand emerged through on-chain data from CryptoQuant, which reported Ethereum’s Coinbase Premium Gap spiking to +6.0 on October 10. This metric indicates ETH was trading significantly higher on Coinbase compared to global exchanges like Binance, typically signaling concentrated buying pressure from U.S.-based institutional investors.
CryptoOnchain’s analysis noted that ‘while the global market was selling, an overwhelmingly aggressive wave of buying was taking place on the Coinbase exchange.’ This divergence between U.S. and global market behavior during corrections often reflects institutional positioning, with sophisticated investors using market weakness to accumulate assets at favorable prices. The substantial premium suggests these buyers were willing to pay above-market rates to secure ETH positions.
The combination of technical pattern recognition, long-term chart targets, and concrete on-chain signals creates a compelling bullish narrative for Ethereum. With the $3,650 support level reclaimed, institutional accumulation during the correction, and historical cycle comparisons suggesting potential for significant upside, traders are watching closely to see if ETH can capitalize on this confluence of positive factors and begin its next leg higher.
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