Ethereum Price Outlook: Could ETH Plunge Towards $2,400 Next?

• Ethereum increased over 1% in a week, trimming its monthly loss to 5.7% despite weak markets
• Whale holdings increased by 90,000 ETH, worth approximately 293 million USD, indicating a rising accumulation.
• Bullish breakout requires a close at $3,486; a failure may see prices drop into the support zone of $2,400 support zone.

Ethereum (ETH) is up just over 1% in the past week, signaling cautious recovery. While the broader crypto market moves higher, ETH is still lagging. Its monthly losses have narrowed to about 5.7%, compared to Bitcoin, which remains down more than 10%. 

At the time of writing, Ethereum was trading at  $3,094.88, which is a slight increase of 1.81% within the past week. Despite that slight increase, the currency has experienced a slight decline in the market today, leaving traders concerned about short-term market factors. The current market capitalization of ETH is $373.53 billion, which is 4.91% of the entire crypto market.

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Ethereum Faces Bearish Flag Risk

The Ethereum price is currently displaying some weakness in the technicals, which is taking the shape of a bear flag, as highlighted by a crypto analyst, Ali Marteniz, in a recent posting. If the pattern confirms, ETH could see its next downside move toward the $2,400 level.

Bullish Structure Forms as Whales Accumulate

Ethereum is forming a cup and handle pattern. Such a pattern is common before a trend reversal. The cup, which is rounded, developed after the trough in mid-November. The recent correction is the handle. The neckline slopes downward slightly, yet the pattern remains technically valid.

As Ethereum started trending out of the handle, whales made their presence felt. Between December 11th and December 12th, the whale supply rose from 100.41 million ETH to 100.50 million ETH. This is an increase of 90,000 ETH. In current prices, this accumulation is worth approximately $293 million.

Ethereum needs a daily close above $3,486, which marks the neckline. This breakout has a measured target of $4,779. This corresponds to a potential 37% increase from the neckline.

The interim resistance is at $3,712 and $4,249. The support is marked at $3,152. On the upside, weakness emerges below $3,152. Breaking below $2,620 withdraws the trade idea. Currently, the trade bias is slightly positive. The whales are buying. The trade formation is intact.

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