Ethereum (ETH) is showing signs of life again—and some technical indicators suggest the next move could be explosive. Traders are eyeing a classic bull flag formation on the charts, paired with a historic trendline indicator that, in the past, has preceded monster rallies.
Currently, Ethereum is trading in a tight range between $2,400 and $2,750. At first glance, that may look like sideways action, but zoom out a bit and the bigger picture becomes more compelling. The price appears to be forming a bull flag—a technical continuation pattern that often follows a sharp upward move, or “flagpole,” and signals potential for another breakout.
In Ethereum’s case, the flagpole stretches from $1,900 to $2,730, and a breakout above the flag’s upper trendline (around $2,600) could imply a next target near $3,600. That’s if the technical setup plays out cleanly. The next resistance level to watch sits in the $3,000 to $3,100 range, where past price action has met heavy selling pressure.
The Relative Strength Index (RSI) on the daily chart is cooling off from overbought territory, creating room for another leg higher—especially if volume starts to climb again. Meanwhile, the 200-day exponential moving average (EMA) is acting as solid support, anchoring Ethereum’s recent price floor.
The Gaussian Channel Holds the Key?
But what really has analysts and traders buzzing is Ethereum’s interaction with a lesser-known, but historically reliable, technical indicator: the Gaussian Channel.
On May 20, Ethereum began nudging up against the midline of the 2-week Gaussian Channel—a dynamic indicator that adapts to volatility and tracks broader price trends. Whenever Ether has managed to decisively reclaim that midline in the past, big gains have followed. For instance, in 2023, ETH rallied 93% after reclaiming this level, and in 2020, a similar move ignited an astonishing 1,820% surge—ushering in a broader altcoin boom.
However, this indicator isn’t foolproof. A similar pattern back in August 2022 failed when the market turned sour, illustrating the importance of broader macro and sentiment-based confirmation.
Adding to the case for a breakout, crypto analyst Merlijn pointed out a golden cross forming on the 12-hour chart, where the 50-day simple moving average crosses above the 200-day SMA. While this is a bullish signal, it’s worth noting that shorter timeframes like the 12-hour chart offer less predictive power than daily or weekly setups.
Still Room for Caution
Not everyone is waving the bullish flag just yet. Crypto trader XO cautioned that Ethereum is still sitting just below a critical resistance zone at $2,800. If ETH fails to breach that level soon, we could be looking at several weeks of sideways movement—a range-bound market that wears out impatient traders.
From a Fibonacci retracement perspective, ETH is currently trading between the 0.5 and 0.618 levels—areas that historically act as resistance before trend continuation. Should the breakout fail to materialize, traders are watching the $2,150 and $1,900 zones for potential support on a deeper correction.
In short, Ethereum’s next move hinges on a few key technical signals aligning. If the bull flag breaks and the Gaussian midline is firmly reclaimed, history suggests ETH could climb toward $3,600—or even higher. But in crypto, caution is always part of the game, and the bears haven’t left the building just yet.
