Ethereum held $2,520 and formed a flag pattern that often comes before a breakout toward higher levels
The RSI formed lower highs while price stayed steady which shows weakening strength despite bullish structure
Price stayed in a range between $2,450 and $2,650 with a clear path mapped toward $4,000 after breakout
Ethereum traded at $2,520 on June 8 while forming a tight flag pattern that may lead to a $4,000 breakout. The structure follows a sharp rally from May lows and now presents a consolidation zone marked by parallel red trendlines. Traders are closely watching this development for the next possible move.
Source: X Ethereum Forms Continuation Flag
The current 4-hour ETH/USD chart from Coinbase displays a well-defined flag formation after a strong bullish move. Ethereum surged from under $2,000 in early May and paused in a sideways range just above $2,500. This range is marked by resistance near $2,650 and support close to $2,450.
Flag formations often act as continuation patterns, where price consolidates before resuming its previous trend. The blue projection line on the chart shows a potential breakout route that could extend toward $4,000. This projection is based on the height of the previous impulse move added to the breakout level.
Historical price action in similar structures shows breakouts occurring when price compresses for multiple sessions with declining volatility. Current Ethereum price behavior matches this condition, with narrowing candles and low expansion. If the price breaches the upper red trendline, a move toward $3,400 and beyond becomes possible.
Bearish RSI Divergence Adds Complexity
Despite the bullish setup, the relative strength index (RSI) at the bottom of the chart shows a downward slope. While Ethereum’s price has stayed inside the flag, RSI has formed lower highs—creating a classic bearish divergence. This divergence suggests slowing momentum even as price holds steady.
The RSI currently sits around 48, which is considered neutral but leaning weak in the short term. Previous rejections near the 60 level align with swing highs on the chart. If RSI fails to recover or breaks below 40, traders may expect a retest of lower price zones.
This divergence is not an automatic signal of reversal but often precedes pullbacks within a larger bullish trend. Traders tracking RSI in conjunction with chart structure may be more cautious before entering aggressive long positions. The breakout, if confirmed, may still require volume support to override the bearish divergence.
$2,450 Support and $2,650 Resistance Define Range
The visible flag is defined by horizontal red resistance around $2,650 and rising support close to $2,450. Price has been trading between these levels for over a week. Breaks outside this range often indicate direction for the next major move.
A clean break above $2,650 could initiate the next rally phase. According to the projection, the measured move could carry Ethereum up toward the $3,400–$4,000 region. The blue path mapped on the chart aligns with this move.
On the downside, a failure to hold $2,450 may lead to a revisit of the $2,200 zone. This level aligns with prior support zones seen in April. Traders are likely to react strongly to any breach of either boundary, given the recent tightening of the range.
