Ethereum's Q1 Struggle: Is the Bullish Dream Still Alive?
As we cross into 2025, the question on every Ethereum enthusiast’s mind remains: Is ETH poised for a major breakout or teetering on the brink of disappointment?
More than two months have passed since Ethereum’s last update, and with it, expectations have continued to rise. But here we are, with ETH retesting crucial levels, and the question still lingers: can Ethereum live up to the bullish narrative?
Revisiting the Key Levels: What's Really Happening?
When we last checked in, Ethereum was rallying above the $3k mark, with bullish signals flashing on the weekly charts. Fast forward to today, and ETH has indeed posted a new high for 2024. However, the optimism that followed the November 4th bullish signal has yet to translate into a clear, sustained trend.
- The Good News:
ETH has managed to reclaim the critical $2800-$3k range, a key support zone that many had hoped would hold. Additionally, ETH is back above the 50-week moving average, a trendline that's historically served as a reliable barometer for Ethereum’s market health. - The Bad News:
While ETH did manage to push above $4k briefly, it failed to maintain momentum or print a meaningful follow-up signal. The bullish structure that many expected after November’s signal has been a no-show, leaving some investors on edge about the sustainability of the current uptrend.
In short, while ETH is holding steady above key support levels, there's an undeniable lack of conviction behind the recent moves. If the price is to maintain a bullish outlook for Q1, these levels—particularly the $2800-$3k zone—must hold.
Monthly Chart: Are We Really in a Bullish Retest?
Looking at the monthly chart, we’re currently sitting at the Price of Control (POC), retesting the mid-level of the recent expansion bar. It could be a textbook retest, but the reality is a bit more complicated. Ethereum has failed to generate any significant bullish momentum since the November signal, which raises concerns.
Historically, Ethereum’s monthly signals have been reliable—hitting targets and catalyzing trends. However, two scenarios stand out as anomalies: October 2021 (just before the cycle top) and May 2024 (after the local top). In both cases, signals failed to fully materialize.
The pattern we're seeing now on the monthly chart—holding above key levels but failing to validate the November signal—doesn’t inspire confidence. For Q1 to remain a viable bullish scenario, we need to see another strong bullish signal within the next two months. Why two months? Monthly signals typically validate within a 3-bar period, and we're currently on the second bar of November’s signal. If it fails to follow through, it might be time to reset expectations and wait for a fresh signal.
The Quarterly Signal: A Bigger Picture Concern
Here's where things get tricky. Historically, Ethereum’s quarterly signals have been on point, guiding us through bullish trends with remarkable accuracy:
- 2017: A bullish signal in Q1, which validated in Q2 and topped out at the end of the cycle.
- 2020: Another bullish signal in Q3, validating quickly and leading to a significant rally.
Right now, we have a similar signal running from Q4 2023. It activated and validated, but as we approach the end of this quarter, it’s clear that this signal could soon expire—marking a potential cycle top.
This is where the concern lies: If the quarterly signal mirrors previous cycles and marks a top, Ethereum may struggle to break through major resistance levels this quarter. However, there’s still hope. Based on Time@Mode analysis, we might see a continuation signal emerge in Q2 2025. If this happens, it could set ETH up for a more robust run later in the year.
ETH/BTC: The Waiting Game
We've discussed the ETH/BTC chart in past updates, and it's become increasingly clear that Ethereum will likely continue to underperform against Bitcoin until late April. While there was early optimism about a reversal, it’s clear that the strength just isn’t there for Ethereum to outpace Bitcoin anytime soon.
If we stick to the system, ETH/BTC could see a turning point around April to June 2025, which would align with the expected continuation signals we’ve discussed.
Conclusion: Patience and Precaution
So, what’s the bottom line? While Ethereum has held key levels and posted new highs for 2024, the lack of bullish follow-through on multiple timeframes leaves us in a holding pattern. The critical $2800-$3k range remains key, but there’s still uncertainty around whether this will lead to the strong Q1 rally many were hoping for.
I’ve learned the hard way not to chase reversals, especially when the chart signals are unclear. The system tells us that patience is necessary, with the real action likely starting in Q2.
As always, proceed with caution—Ethereum’s future is still uncertain, but with time, clearer signals may emerge. Until then, let’s keep our eyes on the key levels and be prepared to adjust accordingly.
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Samuel Castellanos
