Hello friends!
This recent uptick in BTC and ETH was indeed expected (see my previous analysis). However, ETH did not make it up to the 540 region and only rose ~5% today, when compared to BTC which rose ~9%. This is a bearish development. Is $540 off the table? No! However, in the short term, it looks like we are going to retrace.
We have a parallel channel that we have been forming since about the last week of June. We have just formed a bear wick at the top of the this channel. Additionally, we have just completed a bearish Gartley pattern by pausing near the $515 level. These are two very strong indicators that we are headed down.
The target for our parallel chanel is the middle parallel line. If you look earlier in the channel, this has acted as resistance / support at least a few times prior. The first target for the Gartley pattern is the 0.382 level. These both coincide at around the $480 level. If you missed this uptrend, that is where I would consider a re-entry, though you must realize that the 0.618 is a valid downside target as well.
In addition we are seeing divergence on the both the RSI and the CMF on the the 4 hr time frame ( see chart below). Therefore, I highly recommend taking profits if you are in a long (especially if you're in a long from $440, as per my previous idea). This may even be a shorting opportunity depending on your risk tolerance (must have tight stop losses in case bullish trend continues)
Please be sure to give this post a like! Also, would love to engage in a discussion with your thoughts about this setup. Cheers!
This recent uptick in BTC and ETH was indeed expected (see my previous analysis). However, ETH did not make it up to the 540 region and only rose ~5% today, when compared to BTC which rose ~9%. This is a bearish development. Is $540 off the table? No! However, in the short term, it looks like we are going to retrace.
We have a parallel channel that we have been forming since about the last week of June. We have just formed a bear wick at the top of the this channel. Additionally, we have just completed a bearish Gartley pattern by pausing near the $515 level. These are two very strong indicators that we are headed down.
The target for our parallel chanel is the middle parallel line. If you look earlier in the channel, this has acted as resistance / support at least a few times prior. The first target for the Gartley pattern is the 0.382 level. These both coincide at around the $480 level. If you missed this uptrend, that is where I would consider a re-entry, though you must realize that the 0.618 is a valid downside target as well.
In addition we are seeing divergence on the both the RSI and the CMF on the the 4 hr time frame ( see chart below). Therefore, I highly recommend taking profits if you are in a long (especially if you're in a long from $440, as per my previous idea). This may even be a shorting opportunity depending on your risk tolerance (must have tight stop losses in case bullish trend continues)
Please be sure to give this post a like! Also, would love to engage in a discussion with your thoughts about this setup. Cheers!
Comment:
Here is another view of the channel, with more horizontal supports that strongly match the fib retracement levels. ETH is showing significant weakness relative to BTC right now, so Target's 2 and 3 might actually come into play. However, I do believe that the relative weakness will slow down as soon as BTC starts to correct
Comment:
Please see my analysis of the ETHBTC chart for insights as to how the ETHUSD pullback might start slowing down:
Trade active:
We’re closing in on Target 1 much sooner than I expected. BTC seems to just have started correcting. Maybe Target 2 might be in play in the next 24 hours. However expect some bounce at Target 1 unless we’re uber bearish.
Comment:
We are in the Target 1 area, but I suspect we may be going lower. Hold on to your shorts, watch out for your longs.
Comment:
Can I get some likes on the accuracy of this? Though, admittedly, I didn't expect this to play out so soon.
Trade active:
We're crossing Target 1, with no bounce. Look for Target 2 for the support.
Comment:
We're finding some support at the middle parallel. Also the 15 min RSI is super oversold. Expect a bounce playing out soon.
Trade active:
I've closed by short position, but I am looking to re-add at these levels shown below, aiming for actual close in Target 2 or lower. I will turn back to full bull after we cross the stated level in the chart.
Comment:
We got pretty handedly rejected at the 0.236 retracement level. That sucks! However, note that we are now headed towards Target 2, but now with bullish divergence divergence by our side. However, this is only the 15 min chart- the larger timeframes look really bad if we actually break $468. Nevertheless, take care if you choose to pile on your shorts now. I will wait for the retrace to my bounce zone, which might move lower if we do break $468 and keep doing down. We may get to Target 3 this week, but I doubt the bulls refuse to defend Target 2 this downturn.
As of writing, it looks like we're already going to go back. Consider this level close enough to Target 2 to produce our bounce.
As of writing, it looks like we're already going to go back. Consider this level close enough to Target 2 to produce our bounce.
Comment:
OK now we are exactly in the Target 2 area. You can't make this stuff up how precise we have gotten. Now, if you're a bull you really really want this level to hold. If it doesn't then you are looking at a head and shoulder's pattern with a downside target of roughly $425. That's NOT a good place to be at.
Now, if Target 2 doesn't hold, you better start praying that Target 3 does because, in my mind, this is the last stand for the bulls. Below that, $440 -$425 is a very reasonable target.
The good thing is that we are at target 2 with strong 1hr bullish divergence. However, just like I said in the last post, the larger time frames matter. Now the 4hr is looking much worse and the daily is looking much worse now that we have taken out yesterday's lows. Like I said, if you're a bull, pray that things work out. If you're a bear, this is still a risky short. My advice would be if you're going to enter a short, be ready to exit quickly.
Now, if Target 2 doesn't hold, you better start praying that Target 3 does because, in my mind, this is the last stand for the bulls. Below that, $440 -$425 is a very reasonable target.
The good thing is that we are at target 2 with strong 1hr bullish divergence. However, just like I said in the last post, the larger time frames matter. Now the 4hr is looking much worse and the daily is looking much worse now that we have taken out yesterday's lows. Like I said, if you're a bull, pray that things work out. If you're a bear, this is still a risky short. My advice would be if you're going to enter a short, be ready to exit quickly.
Trade closed: target reached:
Hello everyone, as I have mentioned, I have closed my short on ETH. Additionally, I will stop updating this idea. I have published a NEW idea where I will post my updates. See below:
Comment:
Whoops, here is the link:
Here is an image showing how the channel geometry has played an important role in the recent price action.