What does the weekly candle of Ethereum suggest about the formation of a "pre-tower top"?

Ethereum is currently trading at a critical juncture, after the strong volatility that has shaken the broad market, especially after the new conflict in the Middle East. After overcoming the $2,800 resistance level at the beginning of the week, ETH buyers seem to have regained the upper hand. However, the price action could not sustain above this level, which fell sharply and indicated hesitation on the part of investors.

This pullback comes amid rising macroeconomic and geopolitical tensions, especially after Israel's attack on Iran, which has caused widespread risk-averse sentiment in global markets. Ethereum, which is considered a highly volatile asset, cannot escape this turmoil. Despite this, the ETH price remains steady in key technical zones, creating an opportunity for the next big move, either way.

The well-known analyst Big Cheds shared his views on the current situation, highlighting a remarkable technical pattern: ETH is forming a small candlestick with the upper candlestick shadow in the weekly chart. This reflects hesitation and potential weakness at the top, although the trend structure has not yet been completely broken. The next few candles could determine the short-term direction of ETH. The bulls need to push the price back above the $2,800 level to recover momentum, while the downtrend may open up the risk of a sharp correction to the previous price zones.

Ethereum holds its range, waiting for the next move

Ethereum has lost more than 15% of its value since last Wednesday, retraced from a peak near $2,830 and returned to the trading range it has maintained since early May. Despite the price drop, ETH remains structurally firm, respecting the wide consolidation zone. However, price action remains stagnant below the $2,770 resistance, leaving traders and analysts unable to identify the next trend.

Some investors believe that Ethereum could trigger the next altcoin season if it breaks through the current range with strong momentum. A decisive close above $2,800 could restore the upward momentum and signal a capital shift from Bitcoin to ETH and other altcoins. On the contrary, the cautiouss point out that weakening momentum, global uncertainty and the possibility of not maintaining the support level are warning signs for a decline towards the $2,500–2,550 zone.

In addition to the analysis, Cheds notes that the weekly chart of ETH is forming a small-bodied candle with an upper wick, a "pre-tower top" pattern – signaling hesitation before the potential increase in volatility or reversal. This highlights the confrontation between buyers and sellers, while reflecting the current state of the market.

The yield on U.S. Treasury bonds continues to rise, putting pressure on risk assets, while the geopolitical instability, particularly the escalating conflict between Israel and Iran, adds to the concerns and volatility in the global financial markets.

Ethereum struggles to maintain breakthrough

Ethereum is going through a critical moment, when it is unable to maintain a breakout above $2,770. The chart shows that ETH is returning to its previous trading range, testing the $2,530 support level after a sharp decline. The move comes after an unsuccessful breakout attempt, the price was rejected near the 200-day moving average, which is now acting as a moving resistance just below $2,650.

! ETH Price Chart | Source: TradingViewThe sharp increase in trading volume during the recent sell-off confirmed the large bearish interest, adding to the downward pressure. ETH is currently near the lowest level of the trading range since the beginning of May. A decisive break below $2,500 could open up the possibility of a decline to the 50-day moving average at $2,380, bringing ETH back to its previous consolidation levels.

On the positive side, buyers need to regain the $2,650–2,770 resistance zone and make higher lows to recover the bullish momentum. Otherwise, Ethereum could continue to be limited in scope or fall further amid macroeconomic and geopolitical uncertainty.

Annie