Ethereum's Inverted Head and Shoulders Setup: What Traders Should Watch 📊

Traders tracking Ethereum (ETH), here’s a technical development worth monitoring on the weekly timeframe.

Current Market Context

ETH is currently trading around $2.93K with a 24-hour decline of 6.21%. Against this backdrop, the price action has been forming an interesting reversal pattern that could signal potential upside ahead.

The Pattern Taking Shape

On the weekly chart, Ethereum appears to be consolidating into what technical analysts would recognize as an inverted head and shoulders formation—a classic bullish reversal indicator. Here’s how the structure breaks down:

Pattern Elements:

The left shoulder emerged during an earlier decline phase. Following that, the head materialized as a more pronounced dip, representing a deeper capitulation before recovery began. Now, the right shoulder is actively developing as price rallies back toward a critical resistance level known as the neckline.

The Neckline: The Critical Level

The neckline itself aligns with a long-term structural support zone that has proven significant across multiple timeframes. When ETH closes decisively above this neckline on a weekly basis, it would establish a confirmed breakout—the triggering event for the bullish reversal scenario.

Upside Projection

Should the pattern complete, the measured move calculation—using the vertical distance from the head’s low to the neckline—suggests an upside target approximately 60% higher than the breakout level. This projection aligns with the target zone visible on technical charts.

What Confirms the Move

Before traders commit to any positions, these conditions matter:

• A strong weekly close decisively above neckline resistance
• Accompanying volume expansion on the breakout
• A potential retest where the neckline shifts from resistance to support (strengthens conviction if it occurs)

Critical Reminders

The reversal remains unconfirmed until the neckline actually breaks. Weekly patterns demand patience but reward it with higher reliability. Regardless of any technical setup, proper risk management must guide every decision.

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