Ethereum faces potential drop to $1,200 or bullish breakout

Ethereum (CRYPTO:ETH) is currently experiencing a prolonged decline, leading to divided opinions among analysts regarding its next price direction. 

Some predict that ETH could drop to $1,200 by the end of the year, while others see a potential reversal that could push the price above key resistance levels. 

According to crypto analyst Benjamin Cowen, Ethereum is trading within a wedge pattern formed by converging support and resistance lines. 

Cowen notes a similar pattern occurred in 2019 when ETH's price fell sharply after the Federal Reserve announced its first rate cut in over a decade. 

This drop caused ETH to break below its wedge pattern, reaching new lows against Bitcoin (ETH/BTC). 

If a similar scenario unfolds in 2024, ETH could break below its current wedge and fall to around $1,200. 

Cowen believes this potential decline could result in a "soft landing," setting the stage for a rebound in early 2025. 

He highlights that previous cycles saw a significant drop in ETH/USD after a breakdown in the ETH/BTC pair, suggesting a similar move could occur if history repeats itself. 

Conversely, analyst Michaël van de Poppe holds a more optimistic view. 

He argues that Ethereum could soon break its downtrend, pointing to a bullish divergence and higher lows in recent price action. 

Van de Poppe suggests that if ETH breaks its months-long decline, it could trigger a broader market rally. 

Key indicators, such as the Chaikin Money Flow (CMF), also show rising demand for ETH, indicating strong buying activity. 

If this momentum continues, ETH could break through resistance at $2,535 and aim for a 30-day high of $2,867. 

However, an 11% drop remains possible if selling pressure increases and the current uptrend fails to sustain. 

Investors remain cautious as they navigate these conflicting signals, closely monitoring market trends and potential catalysts that could influence Ethereum’s next move. 

At the time of writing, the Ethereum (ETH) price was $2,376.14.