The $3,100 Trigger: Will Ethereum Finally Break Out or Crash to $2,400?

Ethereum is trading just below a long-standing multi-year resistance band around $3,100, a level that has capped upward moves across market cycles. At the time of writing, Ethereum is changing hands near $2,950, down roughly 3% over 24 hours but up nearly 1% on the week, with daily volume close to $22.6 billion. These metrics suggest active market participation but also confirm that the $3,100 zone remains pivotal.

Technical structure: Over the past five-plus years, Ethereum has been confined to a tightening ascending triangle defined by rising lows and a flat resistance band between $3,100 and $4,000. According to commentary from Mr. StockTrader_Max, "$ETH bulls have full control above $3,100," implying that a clean break and weekly close above this area could trigger a significant rally. If that breakout occurs, the path to a retest of the psychologically and technically important $5,000 area becomes plausible given historical cycle behavior and momentum amplification.

Support and moving averages: The 50-week and 200-week moving averages sit close to the current price zone, providing additional dynamic support for buyers. This proximity supports the view that downside risk may be limited if accumulation continues and inflows persist, but it also means that failure to hold these averages could increase downside pressure quickly.

Wedge breakout and accumulation: From September through November, Ethereum formed a falling wedge — a reversal-biased pattern — which broke out at the end of November. That breakout returned price into a tighter range between $2,750 and $3,200, a range that Mr. Don has highlighted as showing signs of accumulation. Remaining above the former wedge resistance is constructive; a confirmed move above $3,200 could set a trajectory toward an interim target near $4,400, projected from the wedge's breakout geometry.

Short-term caution — head and shoulders risk: On the 4-hour chart, a potential head-and-shoulders formation is visible with a neckline around $2,780. Mr. Ali Martinez warned that if this pattern confirms with a decisive break below the neckline, it could open a swift move toward roughly $2,400. Until a breakout (up or down) is confirmed, traders should treat the head-and-shoulders as a near-term risk that raises the probability of increased volatility.

On-chain flows and institutional activity: Despite recent outflows totaling about $555 million this week, the year-to-date picture for 2025 remains robust. Total ETH inflows for the year have reached approximately $12.7 billion, substantially ahead of the $5.3 billion recorded in 2024. Institutional accumulation also continues: Company Bitmine Immersion Technologies, led by Mr. Tom Lee, added 98,852 ETH to its balance sheet over the past week, placing it among the largest known ETH holders. These flows underline that longer-term conviction among some buyers remains strong even as shorter-term traders react to technical patterns.

Conclusion and scenarios: The market now faces two clear scenarios: (1) a clean weekly close above $3,100 that validates bulls and opens the path to higher targets including $4,400 and ultimately a re-test of $5,000; or (2) a failure to hold key support levels and confirmation of the head-and-shoulders pattern that could accelerate a correction toward $2,400. Traders should watch volume on any decisive moves and monitor weekly closes for the most reliable confirmations.

Source: Company CryptoPotato. Additional corporate mention: Company Bitmine Immersion Technologies.