This week, bitcoin and other altcoins livened up the cryptocurrency market, potentially driving up the price of ethereum and saving it from further collapse.
Now that eth is moving away from the lower trendline of a massive long-term price pattern, the next possible target is the upper trendline of the same pattern. That target points to $10,000 per Ether, but how long could it take to reach the lofty price target?
ethereum Rising Wedge Targets $10,000 or Higher
For almost its entire price action history, ETHUSD has been completing what appears to be a massive rising wedge pattern. These patterns are predominantly bearish and break down about 60% of the time.
That leaves 40% of the time these patterns break out to the upside. Pattern descriptions reveal that wedges are notoriously prone to false breakouts and/or false breakouts, where price violates one trend line, only to reverse and point to the other.
However, in the latter case, ethereum maintains the final result. This makes the next logical target the upper trendline, with at least some probability that it can still be broken upwards. The trend line currently sits at around $10,000 per eth and is increasing with each passing day.
It is still in doubt when ETHUSD touches the upper trend line, but considering the duration of previous rallies that lasted between six months and a year, the wait may be shorter than many expect.
Is $10,000 per eth next? | ETHUSD on TradingView.com
Is this the beginning or the end of eth?
Have you ever wondered why a rising wedge pattern can break up if it is a bearish pattern? In the Elliott wave principle, wedges belong to the family of diagonal patterns. Diagonals can be initial or final, expanding as they contract.
An initial diagonal starts a sustained movement. Its wedge appearance is misleading as traders expect the pattern to break, but instead it breaks up. On the contrary, a final diagonal finishes a sustained movement. In this case, the bearish breakout that should be expected in an ascending wedge occurs.
ethereum potentially has a massive diagonal pattern, not the rising wedge it appears to be. What we also don’t know is whether this is the beginning of a larger sustained move and a leading diagonal, or the end of the largest altcoin’s dominance capped by a trailing diagonal.
Both patterns form into a five wave pattern. Unlike standard Elliott Wave patterns, diagonals have unique rules. For example, wave 1 should be the longest, wave 4 should enter the territory of wave 1, and wave 5 is the shortest of the waves. Since this is the last wave and potentially the shortest of all, the touch of the upper trendline could be on the way soon.
