Ethereum Forms Bearish Pennant — Breakdown to $1,740 Possible on Volume Spike
Ethereum (ETH) is compressing into a clearly defined bearish pennant after a prior downtrend, indicating a higher probability of downside continuation. Price has printed consecutive lower highs and lower lows before entering consolidation; support and resistance are converging with declining volatility and falling volume. Traders should watch for a bearish breakdown confirmed by rising sell-side volume — without volume expansion any breakout risks being false. If a valid breakdown occurs, the immediate downside target is the recent swing low at $1,740. Market structure remains bearish until ETH breaks and holds above the pennant’s upper boundary with confirming volume. Key actionable points for traders: monitor volume closely, treat rallies as corrective while lower-high structure persists, use a confirmed volume-backed breakout to enter short positions, and consider $1,740 as the first significant target and liquidity zone.
Bearish
The article describes a bearish pennant following a downtrend with converging support and resistance, declining volatility, and falling volume — classic conditions that favor continuation of the prior move. Pennants historically resolve in the direction of the preceding trend; here that is downward. The piece emphasizes that a valid breakdown requires increasing sell-side volume. If volume confirms a break, price is likely to move quickly toward the $1,740 swing low, making short setups and protective stop placement crucial. In the short term, traders should expect increased volatility around the pennant apex and look for volume-backed breakout entries. In the medium term, acceptance below $1,740 would open room for deeper corrective moves and renewed bearish structure. Conversely, a failed breakdown or a breakout above the pennant with strong buying volume would negate the bearish bias; until that occurs, the risk-reward favors bearish positions. This mirrors past instances where pennant breakdowns (with volume confirmation) accelerated declines and where failed breakouts resulted in range-bound continuation.