Every time I see a rising wedge form on Ethereum, I get that same uneasy feeling in my stomach. It’s like watching someone climb a ladder that’s slowly rotting underneath them, everyone cheering the “new highs” while the structure is literally screaming danger.
Right now, in mid-December 2025, ETH is doing exactly that. Price has clawed its way back toward $3,200 after the recent dip, but the way it’s getting there looks exhausting rather than convincing. Let me walk you through why this particular setup has me more worried than usual.
The Anatomy of Ethereum’s Current Rising Wedge
A rising wedge isn’t some obscure indicator only chart nerds care about. It’s one of the most reliable reversal patterns in technical analysis, especially when it appears after a downtrend like we’ve seen since the November highs.
Think of it this way: price makes higher highs and higher lows, but each push higher is weaker than the last. The trend lines converge, volume typically dries up, and then, boom, the floor drops out. I’ve watched this play out on ETH more times than I can count.
Right now we’re sitting near the apex of this wedge. The upper resistance line connects the November high near $4,000 with the recent bounce highs, while the lower support has been rising steadily from the $2,400 area. Classic textbook stuff.
Volume Tells the Real Story
Here’s what really keeps me up at night: the volume profile.
During this entire recovery from the mid-November lows, buying volume has been pathetic. We’re seeing lower highs in volume while price makes higher highs, exactly the opposite of what you’d want in a healthy bull move.
It’s like watching someone try to inflate a balloon with a pinhole leak. Sure, it gets bigger for a while, but we all know how that ends.
- November crash: massive selling volume
- Initial bounce: decent but decreasing volume
- Current move above $3,000: barely any volume at all
This divergence between price and volume is probably the single strongest bearish signal in the entire setup.
The Value Area High That Never Held
One of the things I always watch on Ethereum is the Value Area High (VAH) from the previous range. When price loses this level cleanly, it almost always leads to a new swing low.
We saw this exact scenario play out last week. ETH sliced through the VAH like butter, dropped to create a new low, and now this “recovery” has brought us right back to test that broken level from below.
It’s the market equivalent of returning to the scene of the crime. And guess what? That VAH is now acting as resistance perfectly, rejecting price multiple times over the past 48 hours.
When a market loses its Value Area High and then tries to reclaim it from below, the failure rate of that reclaim is extremely high.
I’ve tracked this specific setup across multiple cycles, and the bears win more often than not.
Point of Control: The Line in the Sand
If you’re not familiar with volume profile, the Point of Control (POC) is where the most trading actually occurred in a given range. It’s like the “fair value” area that institutions tend to defend.
Right now, Ethereum’s POC from the current range sits right around $2,850-$2,900. Notice how perfectly this aligns with the lower trendline of our rising wedge?
A break below this zone would be catastrophic from a technical perspective. We’re talking about losing the strongest volume node in the entire range, which typically leads to acceleration lower as stops get triggered and liquidity dries up.
I’ve seen moves like this trigger 15-20% drops in a matter of days. The $2,500 zone would be the next logical stop.
Fibonacci Levels Are Conspiring Against Bulls
The 0.618 Fibonacci retracement of the November decline sits almost exactly at current prices. This is textbook reversal territory.
When you combine:
- A rising wedge apex
- The 0.618 Fib
- Broken VAH resistance
- Dying volume
- POC support approaching
…you’re looking for lower prices becomes the higher probability play.
What Would Change My Mind
To be completely transparent, there’s always a bull case. Here’s what would make me flip bullish on this setup:
- A strong volume surge above $3,400 that breaks the upper wedge trendline
- Reclamation of the VAH with conviction (closing above it on daily timeframe)
- Increasing volume on up days, decreasing on down days
- Bitcoin showing relative strength and breaking its own bearish structure
Until I see those things? I’m staying cautious.
The Bigger Picture Context
Stepping back, Ethereum is still making lower highs and lower lows on the weekly and monthly timeframes. This rising wedge is occurring within a clear downtrend channel that started after the March 2024 all-time highs.
We’re essentially getting a bear market rally that looks impressive on short timeframes but is structurally weak when you zoom out. This is exactly how major corrections play out, wave 2 rallies that trap buyers before the real pain of wave 3 begins.
I’ve been trading crypto since 2017, and I’ve never seen a major bear market end with this kind of weak volume structure. The real bull runs come with explosive, high-volume breakouts, not these creeping higher moves that exhaust themselves at Fibonacci resistance.
Potential Price Targets on Breakdown
If this wedge does break down (and current evidence suggests high probability), here are the levels I’m watching:
| Target | Price Level | Confluence |
| Initial Target | $2,700-$2,800 | Wedge measurement + previous support |
| Main Target | $2,500 | Major HTF support + 0.786 Fib |
| Extended Target | $2,200-$2,300 | 2024 lows retest |
The $2,500 zone is particularly interesting because it’s where we have massive volume from the 2024 consolidation period. This is where I’d expect either a major bounce or the final capitulation if bears are hoping for.
Final Thoughts
Look, I love Ethereum. I’ve been holding since $300 and believe in the long-term vision. But loving something doesn’t mean ignoring when the chart is flashing red warning signs.
Right now, everything about this move screams “bear trap” to me. The rising wedge, the volume divergence, the broken market profile structure, the Fibonacci resistance, it’s all lining up for what could be a very painful drop for anyone buying the breakout.
The smart money, in my experience, is either sitting in cash waiting for $2,500 or actively shorting this rally. The retail crowd chasing $4,000 again? They’re likely about to learn a very expensive lesson.
Trade what you see, not what you hope. And right now, what I see is a market that’s exhausted and ready to roll over.
Stay safe out there.
