Ethereum just stopped to consolidate. What happens next?
Ethereum had a parabolic move to the downside, as indicated by the red curved arrows. These moves gain momentum as they go until they reach a selling climax, which did happen in the final sell-off. Since, price has returned to the consolidation zone in the long green box. Here it is rangebound for now.
Note in this chart the two smaller green boxes above and below the longer green box. These represent the same price range as the longer green box, copied in both directions. The bottom green box maps onto the level which provided support at the absolute bottom of the sell-off. Take from this that the top of the upper green box could also be used as a significant price barrier (likely resistance).
More agressive traders may be trading the 'line' as Dow called it. And with 7% up for grabs from the bottom to the top of the consolidation zone, there is reason to trade these moves. Others in search of the bigger moves will probably wait until price breaks out of this zone. Obviously, whether it breaks above or below will be significant.
Trading breakouts can be more complitcated than it seems. There's always a risk of a 'fakeout'. This risk can be mitigated by applying single or double filtering to breakout trading, probably including some type of price filter. Utilising appropriate filters is advisable here.
Upon breaking out of the consolidation zone, the first targets would be the cyan lines shown. If those are broken, a more significant move may develop.
Note in this chart the two smaller green boxes above and below the longer green box. These represent the same price range as the longer green box, copied in both directions. The bottom green box maps onto the level which provided support at the absolute bottom of the sell-off. Take from this that the top of the upper green box could also be used as a significant price barrier (likely resistance).
More agressive traders may be trading the 'line' as Dow called it. And with 7% up for grabs from the bottom to the top of the consolidation zone, there is reason to trade these moves. Others in search of the bigger moves will probably wait until price breaks out of this zone. Obviously, whether it breaks above or below will be significant.
Trading breakouts can be more complitcated than it seems. There's always a risk of a 'fakeout'. This risk can be mitigated by applying single or double filtering to breakout trading, probably including some type of price filter. Utilising appropriate filters is advisable here.
Upon breaking out of the consolidation zone, the first targets would be the cyan lines shown. If those are broken, a more significant move may develop.