coindesk.com
Ether’s weekly chart shows an ascending triangle breakout.
The triangle pattern presents an upside target of $5,200, according to technical analysis by Kraken OTC.
Ethereum’s native token ether (ETH) may have found a path to a new record high of $5,200 after breaking out an “ascending triangle” price pattern, according to technical analysis by Kraken OTC.
ETH, the second-largest cryptocurrency by market value, topped the $3,000 mark early this week, establishing a foothold above the horizontal trendline connecting August 2022 and April 2023 highs. The trendline, along with the upward-sloping bottom line connecting June 2022 and November 2022 lows, comprised an ascending triangle formation on the weekly price chart.
In other words, bulls have pushed through a long-standing resistance, regaining market control after a series of higher lows showing a gradual decline in bears’ strength.
“ETH has not dipped below $2,141, the key pivot on the weekly chart and the upper boundary of an ascending triangle formation. The implied target from this formation is approximately $5,200, which would be a new all-time high for ETH,” Kraken OTC said in a newsletter shared with CoinDesk on Wednesday.
Ether toyed with the upper boundary of the ascending triangle several times since early December, briefly rallying to a high of $2,700 in early January.
Prices, however, soon retreated to the breakout point (the upper end of the triangle) to test the dip demand, and to the cheer of the bulls, the former resistance-turned-support held ground, reinforcing the bullish trend change.
According to Kraken OTC, other indicators like the Ichimoku cloud also paint a bullish picture.
Ichimoku cloud, created by Japanese journalist Goichi Hosada in the 1960s, comprises five lines: Leading Span A, Leading Span B, Conversion Line or Tenkan-Sen (T), Base Line or Kijun-Sen (K) and a lagging closing price line. The difference between Leading Span A and B forms the cloud. A bullish cloud is green, while a bearish one is red. Crossovers above and below the cloud are taken to represent bullish and bearish trend changes.
As of writing, ether traded well above the Ichimoku cloud on the weekly chart.
“According to the weekly Ichimoku Cloud model, ETH is in a firmly bullish posture, trading above the Tenkan-sen, Kijun-sen and the Ichimoku Cloud itself. The critical level to watch is $2,141 – a close below this would invalidate the ascending triangle pattern,” Kraken OTC added.
The bullish posturing on the charts is consistent with a positive fundamental supply outlook. Per some analysts, ether has seen a notable active reduction in its supply since Ethereum switched to a proof-of-stake consensus mechanism and is ripe for a move higher.