In today's analysis, let's take a closer look at Ethereum, which, despite ongoing weakness relative to Bitcoin, is showing early signs of bullish potential.
Historically, Ethereum has underperformed during Bitcoin-led rallies. When Bitcoin climbs higher, Ethereum tends to lag behind, and when Bitcoin faces corrections, Ethereum often falls even faster. This relative weakness has been frustrating for ETH bulls. However, recent developments on the chart suggest that sentiment might be shifting — at least cautiously — toward a more positive outlook.
From a technical perspective, two important bullish steps have already occurred. First, Ethereum managed to break above the green downtrend line, which had been connecting lower highs since mid-March. This initial breakout signaled the end of immediate selling pressure.
The second bullish development was the breakout above the orange horizontal resistance, a key level that had been capping price advances. Now, we observe an important technical behavior: Ethereum is retesting this former resistance as support, and as of the current daily candle, is forming a hammer pattern — a classic reversal signal often associated with a shift from bearish to bullish momentum.
The key moving forward is whether Ethereum can hold above the orange support area. As long as the price remains above this zone, the sentiment is considered positive, and the next logical target would be the purple long-term downtrend line, which acts as a major resistance barrier higher up on the chart.
On the flip side, if Ethereum fails to defend the orange support and closes a day below it, it would be a strong bearish signal, effectively negating the recent bullish efforts and inviting a deeper selloff.
In summary, while Ethereum remains relatively weaker compared to Bitcoin, the technical structure is improving, and holding above the orange support level would further strengthen the bullish case in the short to mid-term.