Ethereum (ETH) Testing Key Support — Will This Bullish Setup Trigger a Bounce Back?

The cryptocurrency market is experiencing a notable retracement today after a strong bullish run that recently pushed Bitcoin (BTC) to a new all-time high of $126,000, before sliding to around $121,000. Ethereum (ETH), meanwhile, has dropped over 5%, falling from its 24-hour high of $4,755 to around $4,445. However, despite the pullback, ETH’s price action remains technically significant — as it is currently testing a key support level that could decide whether the next move is a rebound or a deeper correction.

Source: Coinmarketcap Power of 3 Pattern in Play On the daily chart, Ethereum’s price structure is following the three-phase Power of 3 (PO3) pattern — a common setup seen before major breakouts. Accumulation Phase Throughout August, ETH traded sideways between $4,750 resistance and $4,215 support, signaling accumulation by institutional players as the market consolidated. Manipulation Phase On September 22, $ETH dipped below the $4,215 range, sliding to $3,832 before rebounding sharply. This move marked the manipulation phase, where a false breakdown typically shakes out weak hands and traps shorts before the next leg higher.

Ethereum (ETH) Daily Chart/Coinsprobe (Source: Tradingview) Expansion Phase Following the rebound, ETH reclaimed its previous range near $4,215, entering the expansion phase. The token then rallied toward the $4,752 resistance — the upper boundary of its accumulation zone — before facing rejection. This pullback has now brought ETH back to test its 50-day moving average (MA) near $4,406, a level that could act as a crucial pivot point for the next move. What’s Next for ETH? If buyers manage to defend this 50-day MA support, a bounce from the current zone could set the stage for a break above $4,750, confirming a PO3 breakout. In such a scenario, ETH could rally toward its next technical target around $5,818, reigniting bullish momentum across the broader altcoin market. However, failure to hold this level could push ETH back toward $4,215, delaying the breakout structure. For now, traders and analysts are watching closely to see if Ethereum can maintain strength above the $4,400 region — a successful defense here could very well mark the start of the next leg higher. Disclaimer: This article is for informational purposes only and not financial advice. Always conduct your own research before investing in cryptocurrencies. Also Read: Is Cardano (ADA) Gearing Up for a Bullish Move? Key Fractal Formation Saying Yes!