Current ETH/USDT Chart "W Bottom" Pattern Analysis

Ethereum's price movement is showing a potential "W bottom" formation. We can break it down into the following key stages for analysis:

Key Points of the Pattern
First Valley (W Left Leg): A low point visible around $2,788.60. This is where the price first bottoms out and rebounds during the downtrend.
Neckline: The high point formed after the first rebound, approximately around $3,000. This is a critical resistance level for confirming the pattern in the future.
Second Valley (W Right Leg): The price pulls back again after rebounding and is currently testing support near the first valley, i.e., $2,788.60. If it stabilizes and rebounds at this level, the "W bottom" pattern will be further confirmed.
Current Status: The pattern is not yet complete. Confirmation requires the price to stabilize at the second valley and then break through the neckline ($3,000) with increased volume.
Technical Indicator Support Verification: MACD and KDJ Signal Interpretation
In addition to the price pattern, the validity of the "W bottom" also needs to be supported by technical indicators. The MACD and KDJ indicators shown in the chart provide additional judgment basis.

MACD Indicator: Bearish dominance but showing divergence signs
The current MACD histogram is red and continues to expand, with DIF line (-65.89) and DEA line (-60.59) both below zero, indicating a bearish trend. However, if the price forms at the second valley and the MACD histogram's downward momentum weakens or shows "bottom divergence," it will be a strong reversal signal.

KDJ Indicator: Oversold zone, rebound momentum pending
The K value (23.82) and D value (25.51) in the KDJ indicator are both in oversold territory (usually below 20), suggesting short-term selling pressure may have been exhausted. If the price stabilizes at the second valley and the K value crosses above the D value (golden cross), it indicates a short-term rebound is imminent.
Market Projection and Trading Strategy Recommendations
Based on the current pattern and indicator analysis, we can project Ethereum's short-term trend and provide corresponding trading strategies.

Optimistic Scenario: W Bottom Confirmed, Rebound Begins
If the price stabilizes around $2,788.60 and breaks through $3,000 with volume, the "W bottom" pattern is confirmed. The target can be set at approximately the vertical distance between the neckline and the first valley, around $3,200. Consider establishing long positions upon breakout.

Pessimistic Scenario: Breakdown and Downtrend Continues
If the price fails to hold support at $2,788.60 and shows no significant rebound, the "W bottom" pattern fails, and the market will continue its bearish trend. Support levels below include $2,700 and even $2,500. In this case, maintain a flat position or consider shorting on rallies.
Key Decision Points: The two core factors determining the future trend are the $2,788.60 support level and the $3,000 neckline breakout.