Ethereum Double Bottom Signals Potential $3,900 Breakout as Bullish Momentum Builds

Ethereum is flashing a bullish technical signal that traders and analysts closely watch: a confirmed double bottom pattern on the daily chart. As of early January 2026, ETH is trading near $3,250, showing renewed strength after defending the $3,000 support level twice within six weeks. This price structure often signals trend reversal, and current market data suggests Ethereum may be gearing up for a decisive move higher.

Double Bottom Pattern Strengthens Bullish Case

A double bottom forms when price tests a support zone twice and fails to break lower. In Ethereum’s case, both pullbacks found strong demand near $3,000, with buying volume increasing on the second bounce. From a technical standpoint, this indicates seller exhaustion and growing buyer confidence. The pattern’s neckline sits between $3,280 and $3,320, which ETH is now actively testing.

Historically, Ethereum has delivered strong upside after similar formations. Over the past three years, ETH double bottom breakouts have resulted in an average upside move of 18% to 25% once the neckline was reclaimed on a daily closing basis.

Key Resistance and Breakout Targets

The immediate resistance zone remains $3,300, an area that previously rejected price multiple times in December. A confirmed daily close above this level, supported by rising volume, would validate the breakout. Based on the measured move of the pattern, analysts project a bullish target near $3,900, representing approximately 20% upside from current levels.

Technical indicators also support the bullish outlook. The Relative Strength Index (RSI) on the daily chart is hovering near 58, leaving ample room before overbought conditions. Meanwhile, ETH is trading above its 50-day moving average, a signal that short-term momentum favors buyers.

Volume, Market Structure, and On-Chain Signals

Trading volume has increased by roughly 14% week-over-week, suggesting growing participation as price approaches resistance. On-chain data shows Ethereum daily active addresses are up nearly 9% month-over-month, pointing to healthier network usage rather than purely speculative activity.

Additionally, open interest in ETH derivatives has climbed steadily, indicating that traders are positioning for a directional move rather than sitting on the sidelines.

What Traders Are Watching Next

For analytical traders, the focus is clear: sustained acceptance above $3,300 could trigger momentum-based buying and algorithmic entries. On the downside, failure to hold $3,150-$3,200 may delay the breakout and force another retest of psychological support near $3,000.

In the short term, Ethereum’s price action remains technically constructive. If volume confirms the move, the $3,900 breakout target becomes a realistic scenario rather than speculation.