Ethereum\'s Bullish Flag Pattern Indicates Potential Rebound to March Highs Despite Recent Decline

In a recent report by AMBCrypto, Ethereum [ETH] experienced a bullish close to May, as evidenced by the token's daily chart, which displayed a substantial green candlestick.

After experiencing a bullish close to May, indicated by a large green candlestick on the token's daily chart, Ethereum [ETH] investors were left wanting more as the token experienced a significant decline last week.

However, as reported by AMBCrypto, the token's daily chart revealed a favorable pattern that could enable ETH to revisit its March highs.

According to CoinMarketCap, the price of Ethereum has decreased by more than 7% over the past seven days. At the time of writing, ETH was trading at $3,516.89, with a market capitalization of over $422 billion.

Despite the recent decline, a bullish flag pattern has emerged on the token's daily chart, which should be encouraging for investors.

AMBCCrypto observed that the price of ETH has been consolidating within this pattern after peaking in May. At the time of publication, the token's price was encountering support near the lower boundary of the bullish flag pattern.

A valid breakout from this level could trigger a bull rally, and if this occurs, we could expect to see Ethereum revisit its March highs of $4k in the coming weeks.

As bullish indicators strengthen, ETH is poised for potential gains amid decreasing exchange reserves.

For the bullish flag pattern to be realized, ETH must record a few green candlesticks in the coming days. To assess the likelihood of this occurring, AMBCrypto examined data from CryptoQuant.

Our analysis revealed that the exchange reserve of ETH has been decreasing significantly, indicating a large amount of buying pressure on the token.

Furthermore, the number of coins transacted increased by 13.93% in the past 24 hours, which can be interpreted as a bullish signal.

The derivatives market also appeared to be optimistic, as evidenced by the increasing funding rate of ETH. This suggests that traders in long positions are dominant and are willing to pay traders in short positions.

AMBCCrypto also analyzed data from Glassnode, which showed that the NVT ratio of ETH has decreased in the past week. When this metric decreases, an asset is considered to be undervalued, which usually leads to an increase in price.

At the time of writing, the price of Ethereum was at the lower Bollinger Band, indicating a possible bounce back. Additionally, the token’s Relative Strength Index (RSI) experienced an increase and was close to reaching the neutral level.

However, the MACD showed a slight advantage to the bears in the market, which could potentially hinder ETH's recovery.

Finally, AMBCrypto examined the liquidation heatmap of ETH to identify potential support and resistance levels. We found that if ETH experiences a favorable trend, investors could see the token reach $3,675 soon.

On the other hand, if ETH fails to test the bullish flag pattern, the token may immediately drop to $3,500.

News source：https://www.kdj.com/cryptocurrencies-news/articles/ethereum-bullish-flag-pattern-potential-rebound-march-highs-decline.html

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