Ethereum (ETH) Price Analysis: Triple Bottom Formation Hints at a Q4 Turnaround, But Key Resistance Levels Loom

The cryptocurrency market, led by the largest cryptocurrencies Bitcoin (BTC) and Ethereum (ETH), surged on Tuesday to levels not seen in over a month in anticipation of the Federal Reserve's (Fed) imminent announcement of its first interest rate cut

Anticipating the Federal Reserve’s (Fed) first interest rate cut since the COVID-19 pandemic, the cryptocurrency market surged on Tuesday, with the two largest cryptocurrencies, Bitcoin (BTC) and Ethereum (ETH), reaching levels unseen in over a month.

Despite the expectations surrounding the Fed's announcement and its potential impact on the market, Bitcoin Halving years typically witness a bullish fourth quarter (Q4) for the two major digital assets and the broader market.

Ethereum’s Performance Post-Bitcoin Halving: A Closer Look

notably, Ethereum’s performance following past Bitcoin Halving events has varied significantly. According to data, in the year following the 2016 Halving, Ethereum faced a 45% drawdown before embarking on a remarkable rally that culminated in a 3,400% increase.

Similarly, after the 2020 Halving, ETH surged by 150% before skyrocketing to a 2,150% gain. However, since the latest Halving in April, ETH has closely followed Bitcoin’s volatility, experiencing significant price fluctuations and establishing lower support levels.

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Recently, two major crashes have plagued Ethereum within a month. On August 5, ETH retraced over 25%, plummeting to a six-month low of $2,110. The downtrend continued into September, with increased selling pressure causing a drop from $2,800 to around $2,150 in just one week.

Despite these challenges, analyst CryptoBullet remains optimistic about Q4’s potential for a recovery. Notably, the analyst has identified a “triple bottom” formation on the ETH/USDT daily chart (see below), which is reminiscent of a price pattern observed in 2021.

This pattern suggests that Ethereum may be poised for a rebound similar to that seen in 2021, when it surged from around $1,650 to its all-time high of $4,730. However, at current levels of approximately $2,330, Ethereum is still trading over 52% below its previous all-time high.

ETH Price Analysis: Key Levels to Watch Ahead of Fed Rate Cut

Predicting further price volatility for ETH on Wednesday ahead of the upcoming Fed rate cut, there are key levels to keep an eye on. In the past week, ETH has established the $2,260 mark as a significant support level. This price point is crucial, as it could act as a buffer against a further decline toward $2,200 or even a retest of the next major support at $2,100.

On the upside, the 50-day exponential moving average (EMA) is currently positioned at $2,350, presenting a formidable barrier for Ethereum. This resistance level has been preventing the cryptocurrency from retesting the $2,400 mark in the near term.

Should ETH manage to break above these resistance levels, bullish investors will set their sights on the next major resistance at $2,520. Just above this level lies another critical hurdle at $2,620, where the 200-day EMA is situated. This level has not been surpassed since July of this year, when Ethereum’s price fell below it, initiating the current downtrend.

Featured image from DALL-E, chart from TradingView.com

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