Is Ethereum Ready to Launch to $5000?

The Downside Target Was Reached

In our last update, we found using our Elliot Wave Principle (EWP) count that Ethereum (ETHUSD) was in the final phase of its correction:

“Otherwise, we continue to view Ethereum in … grey W-iv to ideally $2950+/-150 before the [green W-5] of the [red W-iii] to ideally $5000+/-200 kicks in.”

Fast-forward and the second-largest cryptocurrency by market cap decided to morph into an even more complex correction (see Figure 1 below). It bottomed out last week, April 19, at $2866 in what counts best as five waves lower from the early April, grey W-b, high. It has staged a decent rally since.

What Does It Take to Get to $5000?

Besides, yesterday we updated our premium members: “It should now be in the grey W-ii, to ideally around $3000+/-50, contingent on holding above last week’s low.” So far, so good, as ETHUSD bottomed out today at $3072. Besides, the colored warning levels in the chart tell us below which prices it is increasingly less likely for ETHUSD to rally directly to $5000+/-200.

From a technical perspective, we can see the daily RSI5 has broken above its downtrend line, the MACD is on a buy signal, and the money flow is increasing (blue arrows). However, Ethereum’s price is still below its 20- and 50-day Simple Moving Average (-d SMAs) and Ichimoku Cloud.

Assuming our analysis is correct, we want a break above the grey W-i high, coinciding with a break back above the (green) 20-d SMA. That can trigger a run to the grey upper trend line. A break above that line, which equals a break back above the Ichimoku Cloud, is required to confirm the grey W-iii (green arrow). At this stage, the W-iii, iv, and v paths are merely penciled in and not set in stone—a tentative road map.

The ideal target zone for the green W-5 is $4800-5400. But we can reassess that target zone once we get closer. In the bigger picture, once the green W-5 is completed, we should expect a sizeable pullback back to $3500-4000 but not much lower before the final wave of this Bull market that started in 2022 kicks in towards $10K+.