Ether (ETH), Ethereum’s native cryptocurrency, has formed a strong “bear pennant” pattern, suggesting a move may occur in May.
Since May the 11th, ETH’s pricing has been stabilizing between two convergent trendlines. The fact that its sideways movement has coincided with a decrease in trade volumes suggests that ETH/USD may be forming a bear.
As bearish behavior continues, bear pennants are confirmed when prices drop by at least the uptrend’s full height after breaking below the downtrend’s support line (called the flagpole).
This technicality increases the likelihood that Ether will close below its pennant, leading to more declines.
Flagpole at ETH is around $650 in height. If the price breaks the pennant’s upper boundary around $2,030, the bearish goal for the structure is below $1,500, which represents a decrease of more than 25% from its price on May the 15th.
Sell-Offs And Pullbacks For Ethereum
The bear pennant’s profit target corresponds to the zone where the price increased by 250% between February and November of 2021. Furthermore, we anticipate a price of about $1,600, which is close to Ether’s current 200-day EMA.
In an ideal scenario, the demand zone would lead Ether traders to stockpile tokens in anticipation of a quick retracement to the upside.
In that situation, the multiple monthly downward-sloping trendline shown in the chart below, which has served as a resistance in a “falling or dropping channel” pattern, would very certainly become Ethereum’s price interim profit target.
