Ethereum’s Triple Bottom Pattern: A Potential 10% Rally in October
Ethereum’s native token, Ether (ETH), has been exhibiting a bearish reversal setup after experiencing a 6.50% decline so far in October. However, a closer examination! of the 4-hour chart reveals a triple bottom pattern near $3,750-$3,800, which could indicate a possible 10% rally in the coming weeks.
The triple bottom pattern is a technical analysis indicator that forms when prices reach the same support level three times and fail to break lower each time. In the case of ETH, this support lies around $3,750-$3,800, with buyers consistently stepping in to defend the price. Each “trough” shows sellers losing strength while buyers quietly gain momentum.
ETH/USDT four-hour chart. Source: TradingView
The Path to $4,000: Overcoming the Neckline Resistance
Ethereum now faces a key hurdle at its neckline resistance near $3,950-$4,000. This area also coincides with the 50-period exponential moving average (50-period EMA, represented by the red wave). The triple bottom pattern would confirm whether Ethereum breaks the neck line decisively, potentially allowing ETH to rise toward its potential price target of around $4,280 by October or early November, a 10% increase from current levels.
During the formation of the pattern, trading volumes have slowly declined. A noticeable increase in buying volume alongside the breakout will confirm the triple bottom setup. This bullish reversal setup is consistent with trader Kamran Asghar’s analysis, although he points to the $4,800-$5,000 area as the main resistance area.
ETH/USD four-hour chart. Source: X
Mega Whales Accumulate ETH, Absorbing Supply from Smaller Holders
On-chain data from Glassnode shows that there was a significant restructuring of Ethereum ownership during the recent price decline. Large wallets holding 10,000-100,000 ETH, often referred to as “mega whales,” have been accumulating quietly and at the fastest pace in years, now controlling nearly 28 million ETH.
The ETH supply is held by addresses with balances of 1,000 to 100,000. Source: Glassnode
At the same time, smaller whales’ holdings of 1,000-10,000 ETH fell sharply, especially last month during Ether’s price correction. This suggests that when prices fell, some medium-sized holders either sold into the downtrend, with their coins being absorbed by larger investors, or bought more ETH, pushing themselves into the larger cohort.
This article does not contain any investment advice or recommendations. Every investment and trading activity involves risks, and readers should conduct their own research when making their decision. For more information, visit https://cointelegraph.com/news/ethereum-triple-bottom-setup-hints-4k-next?utm_source=rss_feed&utm_medium=rss_category_market-analysis&utm_campaign=rss_partner_inbound
