Market veteran Peter Brandt is bullish on Ethereum, suggesting the altcoin could rally to a new all-time high above $5,600 following formation of a horn bottom.

Renowned trader Peter Brandt recently shared a bullish analysis of Ethereum (ETH) on X. Brandt’s commentary identifies a significant horn bottom pattern, suggesting a potential rally to new all-time highs of $5,600.

The Horn Bottom and Rectangle Pattern

Brandt called attention to the completion of a horn bottom pattern in February 2024. A bullish reversal pattern, the horn bottom typically forms after a prolonged downtrend and features a rounded bottom followed by a sharp dip and recovery, resembling a horn. This pattern indicates a potential trend reversal from bearish to bullish.

In the accompanying chart, Ethereum’s price action over the past few months has been oscillating within a descending rectangle pattern. The pattern also resembles a bullish pennant due to the uptrend from earlier this year.

A perspective on $ETH
Support was found at lower boundary of 4+ month rectangle, which was a retest of the Feb completion of a horn bottom
Target, pending upside completion, is 5600+ pic.twitter.com/EThcM61KpW

— Peter Brandt (@PeterLBrandt) July 15, 2024

The upper boundary of this rectangle is around $4,093.88, while the lower boundary is approximately $2,800. Brandt notes that support was found at the lower boundary of this rectangle, which aligns with the retest of the horn bottom completion in February.

The chart also features the 18-week and the 8-week moving averages. These moving averages provide dynamic support and resistance levels, guiding the price movements. Ethereum’s price has been respecting these moving averages, bouncing off them as it consolidates within the rectangle.

Meanwhile, the ADX (Average Directional Index) shows a value of 24.43, indicating a trend is present, though not very strong. This suggests a period of consolidation and accumulation before a potential breakout. The ATR (Average True Range) value of 432.39 reflects the volatility over the past 30 weeks.

Brandt Projects Ethereum Rally Above $5,600

Brandt’s bullish outlook cites the premise of an upside breakout from the rectangle pattern. The height of the rectangle projects upward from the breakout point to estimate the target price. In this case, Brandt forecasts a target above $5,600, which implies a significant upside potential from the current levels.

Such a price would mark a new ATH for Ethereum, surpassing the previous peak of $4,868 in November 2021. The latest projection comes after Brandt predicted an ETH drop in June amid a head and shoulders formation. This prediction materialized, as ETH collapsed 21% less than a month after that.

Ethereum is trading at $3,420 at press im, reflecting a recent decline of 1.81%. However, it has capitalized on the ongoing market revival. The current price action shows Ethereum attempting to recover from a lower low, consistent with the support identified by Brandt.

Ethereum Daily Chart

The Relative Strength Index (RSI) is at 56.89, suggesting that Ethereum is in a neutral zone, neither overbought nor oversold. This position signals potential for upward movement if buying pressure increases.

The Moving Average Convergence Divergence (MACD) indicator shows a recent bullish crossover, with the MACD line crossing above the signal line. This bullish signal, combined with increasing histogram bars, supports Brandt’s optimistic outlook.