The price of Ethereum (ETH) has experienced significant growth since October 19, reaching a peak of $1,854 today. This surge has confirmed the presence of a long-term upward support trendline and has brought the price close to a descending resistance trendline, prompting speculation about whether Ethereum will break out further.

Ethereum Finds Support in a Nearly 500-Day Ascending Trendline

Analyzing the weekly time frame chart, it becomes evident that Ethereum's price has been following an ascending support trendline since it hit a low of $882 in June 2022. This support trendline has effectively defined the upward trajectory of the price.

In October, ETH experienced a rebound at this trendline, forming a bullish engulfing candlestick the following week (represented by the green icon). A bullish engulfing candlestick signifies a reversal of a previous downward trend, erasing the losses from the previous period.

The last time a similar candlestick was observed was in July 2021 (represented by the black icon), which ultimately led to the all-time high price of $4,868 in November.

The weekly Relative Strength Index (RSI), used as a momentum indicator, currently indicates a bullish sentiment. An RSI reading above 50 typically favors bulls, while a reading below 50 suggests the opposite. The RSI is currently on the rise and has just crossed above the 50 mark (indicated by the green circle), both of which are positive signs for a bullish trend.

Whales Are Accumulating Ethereum

On-chain data for Ethereum's price paints a bullish picture, particularly when considering the activities of large holders, known as whales. In the past 24 hours, two whales withdrew 39,450 Ethereum, valued at nearly $68 million, from Coinbase. Another whale also withdrew $15 million worth of ETH from Coinbase. These significant withdrawals from centralized exchanges, totaling $83 million worth of ETH, can create a supply shortage, potentially leading to price increases.

Additionally, there is a potential liquidation risk for the former Frog Nation CFO, 0xSifu, who holds an ETH short position exceeding $21 million on Synthetix perpetual contracts. If the ETH price rises to $1,926, he could face liquidation.

Price Prediction: Ethereum's Yearly High as the Next Target?

A closer look at the daily timeframe from a technical analysis perspective suggests a bullish outlook. Prior to the price increase, a long-term bullish divergence in the daily RSI (indicated by green) was observed. A bullish divergence occurs when momentum increases alongside a price decrease, often indicating an impending bullish trend reversal.

Currently, the ETH price has reached a descending resistance trendline that has been in place since Ethereum's yearly high. A breakout from this trendline would confirm a bullish trend reversal, with the next significant resistance level at $2,000, representing a 10% increase from the current price. This level is slightly below Ethereum's yearly high of $2,141.

In light of this ongoing breakout, prominent cryptocurrency trader Crypto Tony believes that Ethereum's price will reach this target. However, it's important to note that a rejection from the resistance trendline could result in a 5% drop to the nearest horizontal support area at $1,750.

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