Ethereum Daily EMAs have stacked bullish, SMAs likely to follow
Updated
There is a lot of power in having the moving averages sorted out either fully bullishly or fully bearishly for people that like to have some confirmation that a prolonged move is coming. During consolidation periods EMAs and SMAs are often not in full agreement because they move at different speeds and people hoping to go long early on the EMA signals may miss the traders using a SMA system looking for resistance.
So when both EMAs and SMAs get sorted out then both sets of traders are looking for blue sky moves. The chart below zooms in and shows that the EMAs (on the right) as a few days ago have fully sorted themselves out fully bullishly. Price is above the price action and every EMA is above the the EMAs with a longer time period. The SMAs still need to sort themselves out based on their lower nature. This unsorting on the SMAs may take a month. The 20 should be above the 100 in short order and (with a high probability if) when the 50 gets above the 100 SMA the stack should be complete. There may be some thrash and sideways action which takes a while to get sorted but with the optimism in Ethereum I predict the SMAs will ultimately stack bullish.
The main chart shows some previous gains on similar signals, just holding until the 20 and 50 finally cross bearishly. And of course, you can always get in again when the stack is bullish and stay safe during the chop. I very recently flipped my bias on ETH after being bearish using my volatility set ups, which is my preferred system of setting up bias. THe EMAS stacking bullish helps me confirm that post because it suggest with a high probability the bullishness on the daily will carry over onto the weekly. The linked post will show that I flipped my bias on ETH because the breakdown that was occurring on the monthly was reversed the last week of the month and my volatility system showed support was confirmed.
Just to make the chart a little noisy I also showed where the EMAs and SMAs have stacked fully bearish. Bear markets are often quicker and more viscous the bull markets and so having that understanding can help you be on the right side of trades.
Now the stack is bullish on the EMAs I will be using a basic HA and moving average strategy. Two shadowless green candles on the 12 hour after pull back and I buy the dip. Supplement with some basic charting and divergence indicators and I am good to go.
Below is a quick look at the volatility system I use to determine my bias. My linked idea will show the monthly chart. The daily on the left is a clear bullish chart, with the price above the VSTOP and MFF VSTOPx3 and the 20 period SMA. Also, MACD is crossed bullishly. On the 3 day the MTF VSTOP needs to be broken and confirmed ad the price needs to say above the standard VSTOP level around 2719. The weekly chart has just over 2 days to stay above the MTF VSTOP and hopefully in the next week or two confirm the MACD cross.
Ultimately I hope to get out of my trades at the 2 line on the fib chart. But that will be another idea. As I mentioned in a previous idea, finding support on the 1 line is incredibly bullish. Also, finding resistance at the 1.272 (literally could not stay a whole candle body above for more than 2 days in a row) shows that the fib channel as a whole is predictive.
So when both EMAs and SMAs get sorted out then both sets of traders are looking for blue sky moves. The chart below zooms in and shows that the EMAs (on the right) as a few days ago have fully sorted themselves out fully bullishly. Price is above the price action and every EMA is above the the EMAs with a longer time period. The SMAs still need to sort themselves out based on their lower nature. This unsorting on the SMAs may take a month. The 20 should be above the 100 in short order and (with a high probability if) when the 50 gets above the 100 SMA the stack should be complete. There may be some thrash and sideways action which takes a while to get sorted but with the optimism in Ethereum I predict the SMAs will ultimately stack bullish.
The main chart shows some previous gains on similar signals, just holding until the 20 and 50 finally cross bearishly. And of course, you can always get in again when the stack is bullish and stay safe during the chop. I very recently flipped my bias on ETH after being bearish using my volatility set ups, which is my preferred system of setting up bias. THe EMAS stacking bullish helps me confirm that post because it suggest with a high probability the bullishness on the daily will carry over onto the weekly. The linked post will show that I flipped my bias on ETH because the breakdown that was occurring on the monthly was reversed the last week of the month and my volatility system showed support was confirmed.
Just to make the chart a little noisy I also showed where the EMAs and SMAs have stacked fully bearish. Bear markets are often quicker and more viscous the bull markets and so having that understanding can help you be on the right side of trades.
Now the stack is bullish on the EMAs I will be using a basic HA and moving average strategy. Two shadowless green candles on the 12 hour after pull back and I buy the dip. Supplement with some basic charting and divergence indicators and I am good to go.
Below is a quick look at the volatility system I use to determine my bias. My linked idea will show the monthly chart. The daily on the left is a clear bullish chart, with the price above the VSTOP and MFF VSTOPx3 and the 20 period SMA. Also, MACD is crossed bullishly. On the 3 day the MTF VSTOP needs to be broken and confirmed ad the price needs to say above the standard VSTOP level around 2719. The weekly chart has just over 2 days to stay above the MTF VSTOP and hopefully in the next week or two confirm the MACD cross.
Ultimately I hope to get out of my trades at the 2 line on the fib chart. But that will be another idea. As I mentioned in a previous idea, finding support on the 1 line is incredibly bullish. Also, finding resistance at the 1.272 (literally could not stay a whole candle body above for more than 2 days in a row) shows that the fib channel as a whole is predictive.
Note
The EMAs have finally sorted themselves out bullishly on the daily chart and have had a couple of green candles afterwards. I see a quick move up and then some sideways action until the SMAs likewise get sorted.
It may be when that happens the upward move may be about done. Lots of people are expecting a few months of insanity to the upside and then a blow off top. That is part of the problem of using some of these slower SMA length crosses for signal entries
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