Peter Brandt Goes Long on Ethereum, Predicts Breakout to $4,032

Legendary trader Peter Brandt opens a long position in Ethereum with a target of $4,032, leveraging a descending wedge pattern to predict a bullish breakout from $2,741.

Peter Brandt, a seasoned trader and classical chartist, recently shared his current trades on social media, highlighting a notable bullish signal for Ethereum. 

Brandt, known for his adherence to classical charting techniques from Schabacker’s 1934 methods, focuses on swing trading by identifying and trading breakout patterns. According to an X post, his trading approach has a 55% hit rate, implying his method’s reliability.

As a trader I'm a classical chartist (Schabacker, 1934)
I'm a swing trader who draws lines on charts & buys/sells pattern breakouts
Hit rate = 55%
Here are 4 trades I'm in now with entry/targets noted
Long $ETH spot
Long Meal futures $ZMN24
Long $GLD
Long Silver futures $SIU24 pic.twitter.com/pc1V8WJxhO

— Peter Brandt (@PeterLBrandt) May 26, 2024

Brandt Targets $4,032 in Ethereum

Peter Brandt’s chart analysis indicates a classic descending wedge pattern for Ethereum, a bullish signal that typically suggests an upward breakout. According to the chart, the breakout has already been confirmed by a sharp increase in price past the upper trendline of the wedge.

Moreover, Brandt shows that his entry point for Ethereum was at $2,741, anticipating the upward momentum. He further anticipates a target of $4,032, suggesting significant profit potential and reflecting confidence in Ethereum’s continued rise.

In addition to his Ethereum trade, Peter Brandt has revealed three other strategic positions, further diversifying his portfolio. He has gone long on Soybean Meal futures (ZMN24), SPDR Gold Trust (GLD), and Silver futures (SIU24). Each of these trades is based on his classical charting techniques, aiming to profit from anticipated breakout movements.

Brandt’s Ethereum Criticisms

In contrast to his current bullish stance, Brandt predicted in December of last year that Ethereum could experience a severe downturn, potentially dropping below $700. At that time, Brandt noted that classical chart patterns in price charts are not infallible and often fail to perform as expected.

Had ETH fallen to $650 from its value of $2,156 at the time, it would have marked a near 70% decline for the leading smart contract platform. Moreover, last Friday, he warned of potential risks in the crypto staking sector following the U.S. SEC’s approval of spot Ethereum ETFs. 

Brandt cautioned that the complexities of staking could lead to substantial financial pitfalls for uninformed investors.

Staking
=
Owning/borrowing/leveraging an asset (ETH/SOL/name it)
Lending it out for revenue (i.e.: interest)
=
Eventual involvement by CBs/govt treasuries
=
Regulatory authority over staking
=
End to staking https://t.co/hv835g3pfK

— Peter Brandt (@PeterLBrandt) May 24, 2024

ETH Price Action

Meanwhile, on the weekly chart, ETH presently exhibits a symmetrical triangle pattern characterized by lower highs and higher lows. The descending resistance line, drawn from the all-time high of $4,868.8, forms the upper boundary of this long-term descending triangle pattern. 

Complementing this, the ascending support line, extending from the 2018 low, delineates the lower boundary, creating a significant structural formation on the price chart.

According to the chart, Ethereum marked a low of around $81.9 in 2018, signaling the beginning of a substantial upward trend. This momentum eventually propelled ETH to its ATH of $4,868. 

More recently, the token has rebounded from the 0.618 Fibonacci retracement level near $3,000, underscoring strong support at this price point.

In a bullish scenario, a successful break above the descending resistance line and the 0.786 Fibonacci level around $3,900 could pave the way towards the ATH near $4,868.8. A confirmed breakout beyond this level would be a robust bullish indicator, possibly leading to new record highs.

Conversely, a bearish scenario would unfold if Ethereum fails to overcome the resistance and drops below the 0.618 level. This could lead to a retest of lower support levels, including the crucial ascending support line.