ETHUSD reaching critical 0.618 fib retracement
The ETH rally is coming to an end. It could make another leg up, but the bullish momentum is dying.
In terms of price action, it has tested 170$ resistance, which was a strong support on the way down.
In terms of trend lines, it has been stopped by yellow resistance in play since august.
In terms of Fibonacci proportions, it stopped just shy of 0.618 golden retracement of late 2018 dump.
In terms of Elliott counts, it seems to have finished a second bullish impulse, which could mean the end of an ABC bullish retracement.
In terms of patterns, it just broke down of the ascending wedge formed by last impulse, which is usually a signal for momentum shift.
In terms of RSI, it is showing a bearish divergence on the 4h chart.
All these make strong arguments for the bears.
Yet, let's consider the bulls' point of view...
Fibonacci : depending on where you start the retracement from, there is still room for more upside
Trend lines : we still need to retest the blue resistance in play since ATH
Elliott counts : ETH, LTC and more importantly BTC seem to be moving one at a time, but we can't ignore the usual correlation, and it seems there is still room for BTC to recover. It would be very surprising if ETH starts a clear downtrend while BTC is still bullish.
ETH hardfork : it should happen on january 16th, it shouldn't bring any new tokens of value, but any hardfork has its own hype. ETH could have some fuel left if the pre-fork hype has not been played out already.
Conclusion :
Looking only at the ETH chart TA, I'm bearish.
I have entered a careful small short position with a stop-loss at last high.
Shall ETH make another leg up, I'll be happy to let it ride even higher, take my loss, and renter a short position in an even more comfortable spot.
TP1 : 135 (0.382 fib, strong support)
TP2 : 125 (0.5 fib, another support)
TP3 : 115 (0.618 fib, last support)
Once the bears take control of the whole crypto space again, I think a retest of the sub-100$ zone is in order. Letting part of the short position ride or re-open short upon confirmation of a panic market should be in mind.
Happy trading !
In terms of price action, it has tested 170$ resistance, which was a strong support on the way down.
In terms of trend lines, it has been stopped by yellow resistance in play since august.
In terms of Fibonacci proportions, it stopped just shy of 0.618 golden retracement of late 2018 dump.
In terms of Elliott counts, it seems to have finished a second bullish impulse, which could mean the end of an ABC bullish retracement.
In terms of patterns, it just broke down of the ascending wedge formed by last impulse, which is usually a signal for momentum shift.
In terms of RSI, it is showing a bearish divergence on the 4h chart.
All these make strong arguments for the bears.
Yet, let's consider the bulls' point of view...
Fibonacci : depending on where you start the retracement from, there is still room for more upside
Trend lines : we still need to retest the blue resistance in play since ATH
Elliott counts : ETH, LTC and more importantly BTC seem to be moving one at a time, but we can't ignore the usual correlation, and it seems there is still room for BTC to recover. It would be very surprising if ETH starts a clear downtrend while BTC is still bullish.
ETH hardfork : it should happen on january 16th, it shouldn't bring any new tokens of value, but any hardfork has its own hype. ETH could have some fuel left if the pre-fork hype has not been played out already.
Conclusion :
Looking only at the ETH chart TA, I'm bearish.
I have entered a careful small short position with a stop-loss at last high.
Shall ETH make another leg up, I'll be happy to let it ride even higher, take my loss, and renter a short position in an even more comfortable spot.
TP1 : 135 (0.382 fib, strong support)
TP2 : 125 (0.5 fib, another support)
TP3 : 115 (0.618 fib, last support)
Once the bears take control of the whole crypto space again, I think a retest of the sub-100$ zone is in order. Letting part of the short position ride or re-open short upon confirmation of a panic market should be in mind.
Happy trading !
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