Ethereum Price Mirrors Bitcoin 2020 Run: Parabolic Rally Ahead?

Key Insights

• Ethereum price is preparing for a parabolic rally, says analyst.
• ETH could retest $4,000 before recovering and rallying to new highs.
• Whale profit-taking is causing the price to stall below $4,800.

Ethereum price action mirrors Bitcoin’s technical setup during the 2020 bull market when BTC kicked off its ascent from around $10,000 to that year’s high of $35,000.

This rally continued gradually until the price of BTC reached $64,500 in April 2021. According to trader and analyst Ash Crypto, Ethereum’s price is following a similar trend, rising through three major phases: accumulation, breakout, and a parabolic run.

At the time of writing, the leading altcoin was trading for $4,174 with a daily negative change of 4.45%.

Ethereum Price is Preparing for a Parabolic Rally, Says Analyst

The 1-month Ethereum chart shows a similar technical setup as Bitcoin’s 2020 bull run, according to Ash Crypto. If the pattern successfully plays out, the analyst predicted that the price of Ethereum could explode to new all-time highs, surpassing the $ 5,000 level.

The parabolic run could 2x or 3x the Ethereum price from its current level, explained the analyst.

Will Ethereum Price Retest $4,000 Before Rally?

On the 1-day chart, Ethereum is struggling to sustain an uptrend past the $4,400 level. This is happening even after the altcoin nearly broke the $5,000 upper resistance but failed to maintain the levels, causing it to drop all the way to $4,300.

Nonetheless, there is strong support within the ascending trendline near the $4,000 psychological level. As such, the altcoin could retest that level before experiencing recovery.

While writing, the Stochastic Relative Strength Index (RSI) was at 22, implying oversold conditions and relatively low buying strength.

This suggests there are high chances of retesting lower levels before a recovery becomes possible. At the press time price of $4,174, the main resistance level to watch is $4,800.

The fizzling price momentum is a result of increasing profit-taking among retail and some whales, which has added more burden to the reversal.

However, there also appears to be a sufficient power balance between selling and buying pressure, which is holding the price between two key levels, $4,000 and $4,800.

On-chain Data Shows Profiteering, Greed and Fear Index Clocks Greed

As per insights from Lookonchain, various traders have been closing their ETH positions, including one trader who took a profit of $6.86 Million from 66,749 ETH longs worth $303 Million.

Another trader also made $4.04 Million and closed a $9.57 Million ETH position.

Interestingly, Ethereum’s greed and fear index reached 57, suggesting that the altcoin’s market sentiment is confident and optimistic about the price growing from its current level.

While retail may have failed to counter the sell-off, a significant possibility exists that institutional demand and accumulation will drive Ether’s price toward recovery.

According to Glassnode, there’s still strong investor engagement between the current price level and the key resistance, indicating a chance for the price to rally upwards.

In conclusion, while Ethereum’s current performance mirrors the 2020 Bitcoin bull run, continued profit-taking and retail sell-off have stalled the price below $4,800.

Meanwhile, a crucial level to watch out for is the $4,000 support level. If the price drops to this zone, there’s a high chance of recovering and rallying past the key resistance line at $4,800.