Ethereum Price Prediction for January 7: Corrective Rally or New All-Time Highs?
Ethereum has been on the rise since hitting a low on December 20th, but the recent rally may just be a corrective move. The current price action doesn’t show enough strength to confirm a solid upward trend, but this could change as the market evolves. There are two possible scenarios to consider going forward.
Scenario 1: Corrective Rally (B-Wave Correction)
In this scenario, the recent upward movement is seen as part of a broader B-wave correction. The decline from December 6th to December 20th is considered an ABC structure (Wave A), and the current upward move could be Wave B, forming either as an ABC or WXY structure. A WXY formation is common in the crypto market. Once the B-wave reaches its peak and breaks below key support levels, a C-wave down could begin, signaling a bearish phase.
Key Resistance and Support Levels
The initial key resistance was at the previous swing high of $3550. With Ethereum reaching its target zone, the upward move may be complete. However, breaking below the recent swing low at $3593 and support at $3515 would confirm the end of the rally.
Scenario 2: Bullish Scenario (New All-Time Highs)
In this more optimistic scenario, Ethereum could be aiming for new all-time highs after potentially hitting a wave two bottom around December 20th. However, the current upward move lacks the clear impulsive characteristics of a third wave in Elliott Wave theory. Breaking above the $3800-$3880 zone could provide more evidence for this bullish outlook, but a correction may precede further upward movement.
Key Levels to Watch
Support Levels: $3593 and $3515–$3575 (Micro Support Zone).
Resistance Levels: $3808 and $3880 (Potential Resistance Zone).
Trend Confirmation: A break below the trend channel and the 78.6% Fibonacci retracement level at $2400 would indicate a shift to a more bearish outlook.
In conclusion, Ethereum’s price prediction for January 7 is uncertain, with two possible scenarios playing out. Traders and investors should closely monitor key levels and watch for confirmation of a trend in either direction. Stay informed with real-time updates on the latest trends in the crypto world to make informed decisions in this volatile market.