Ethereum has returned to trading just above $3,300 per ETH as part of a sluggish rally over the past week. After months of wide fluctuations and failed consecutive trades above $3,000, the structure on the monthly time frame chart begins to look bullish in a way that traders should take it seriously.
AND recent technical failure shared by Merlijn The Trader on X shows that Ethereum is approaching a point where consolidation may give way to sturdy expansion, with the most critical turning point being $5,000.
The bullish pennant says that the bullish momentum will soon be unlocked
The Merlijn technical analysis chart shows a bullish pennant forming on the Ethereum monthly time frame. This bullish pennant shows that price action is condensing between a rising support line and a falling resistance line, which has led to a narrowing structure from 2021 onwards.
Ethereum briefly broke above the upper limit of this pennant in 2025, reaching just below $5,000, before momentum weakened and corrective moves occurred. Since then, price action appears to be returning towards the former resistance line, which is now a key area of concern. As things currently stand, Ethereum is retesting the upper trendline of this bullish pennant for a final upward move.
Based on this prediction, the first major barrier for Ethereum to break is around $3,300. A clear break above this level would likely open the door to $3,600, an area that has previously represented a turning point during previous gains. The most critical zone, however, is located around the all-time high of $5,000 in August 2025. A break above this zone would unlock bullish momentum based on the bullish pennant and will take place over most of 2026.
How might this breakout play out?
The Merlijn chart does not stop at the breakout trigger point when it breaks above the upper pennant trendline. He sketches a full roadmap of how this movement could develop once Ethereum leaves the pennant. The first step in this projection means an boost above $3,600 before a more significant test around $5,000. Once Ethereum is able to break above $5,000, the door will open to fresh price highs.
However, a breakout can be expected there will be variability and retests, is not a straight line up, but still splits higher if the pennant thesis holds.
From $5,000, the projection turns into a two-stage expansion. The first stage shows a strength move, with Ethereum climbing higher all the way to $6,000, then breaking through another acute decline to $4,000 and another rebound sequence before a larger leg goes higher. The larger leg, projected higher on the chart, points to $8,400 as the final price target zone for Ethereum.
Featured image from Getty Images, chart from Tradingview.com
