As the price of Ethereum'due south native digital currency, Ether (ETH), has been showing massive strength recently, the path seems to be continuing toward new highs. Ether price ran from $220 to $445 in the previous 5 weeks, and this is ane of the biggest surges for the altcoin in the past 18 months.

However, equally the rally didn't provide many opportunities for laggards to hop on the train, is $500 the side by side target for Ether? Let'south examine the technical setup.

Crypto market daily performance

Crypto market daily performance. Source: Coin360

Ether flips crucial level for support, fueling bullish momentum

Every bit Ether broke through the magical barrier of $340 to $360 equally crucial resistance, it was crucial for the bulls to flip this area into a new back up zone.

ETH/USDT 1-day chart

ETH/USDT 1-mean solar day nautical chart. Source: TradingView

The nautical chart proves this level'due south significance, as the $340–$360 zone became support throughout the previous bull market place. However, the breakdown in Baronial 2022 led to a two-year accumulation range.

Similarly, a previous test at the $340–$360 range in July 2022 failed to intermission through this crucial resistance zone. Recently, a renewed breakout led to a breaker, every bit the chart confirms the back up/resistance flip.

Next to that, Ether is rallying above the 100-twenty-four hours and 200-24-hour interval moving averages, which are crucial for bullish momentum. As long every bit Ether sustains support above these moving averages, farther bullish continuation is likely to expect.

Trend reversal was confirmed on smaller timeframes

The smaller timeframes signaled an credible tendency reversal, as the chart shows.

ETH/USDT 4-hour chart

ETH/USDT 4-hr nautical chart. Source: TradingView

First of all, the crucial college timeframe back up zone betwixt $340 and $360 provided support once again.

This back up confirmed back up through the double-lesser structure on smaller timeframes, signaling a potential bottom confirmation.

As a trader, the next confirmation yous'd like to get is a new college high, which was confirmed once the price of Ether broke through the loftier at $408 (the cherry-red line). This breakthrough led to a further surge of the cost, which is virtually a new yearly high.

The bullish scenario for Ether

ETH/USDT 4-hour bullish scenario chart

ETH/USDT four-hour bullish scenario chart. Source: TradingView

The price of Ether is currently fighting the last hurdle earlier new highs. If that happens, a renewed rally toward $500 is very likely to occur.

Still, the crucial expanse to hold for ETH price can be found in the lower green box. As long as Ether sustains support at the $396–$410 area, further continuation is likely.

As a breakthrough in the recent loftier at $445 is crucial for continuation, the new targets can be defined through the Fibonacci extension tool.

Using this tool, a new target at $500 can be drawn, and it'southward very likely to be hitting once ETH breaks through the recent high.

The bearish scenario for Ether

ETH/USDT 4-hour bearish scenario chart

ETH/USDT four-hour bearish scenario nautical chart. Source: TradingView

The same areas are also crucial in the bearish scenario. If the price of Ether rejects at the current resistance zone and fails to hold the $396–$408 expanse for support, a further decline is very probable to occur.

The targets for a downtrend construction can be divers using both the Fibonacci extension and toll action. Information technology'south very probable to expect a failure of the $360 support area if the price of Ether gets to that level once again.

If the toll of ETH drops toward the $360 area, it's more probable to expect a farther refuse, and then the eyes are focused on the $310–$320 expanse.

However, in the current climate and the current strength, the bearish scenario is a lot less likely than the bullish scenario.

The views and opinions expressed hither are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your ain inquiry when making a decision.