Ether and the entire space has clearly entered a corrective pattern which is not surprising after going from a low of $360 in early April to a local top of $838 May 6th (an impressive 2.3x over 1 month). Generally corrections of major trends retrace between 33% - 66% of the entire move with the 33%, 50%, and 66% prices being places to look for reversals. If you're a Fibonacci fan you can look to 31.2% and 61.8% areas. Given the top and bottom I will look for signs of reversals at:
- $678 = 33%
- $599 = 50%
- $519 = 66%
We are already seeing the zone around the 33% retrace holding support. This is not surprising given that this zone held for almost 4 days between 4/27-5/1. If I had the ability to be a computer constantly I would consider daytrading at this level with a target of selling the position near the falling trend line around $705. However, I think this is a risky trade and I can't give it the attention it needs.
The next support will likely be around $599. I do not think it will give strong support and if we do retest it I suspect we will fall right through it toward the 66% retracement. Around $519 is where I hope to be a buyer if the market shows signs of reversal. If not then we may test the critical support levels of $400 and $360. Typically a retracement past 66% (or 61.8%) signals something more than a "correction." It often signals a broader trend reversal and I would expect to see accelerated selling and mass carnage. For my long term positions I hope this isn't the case. I hope what we are seeing right now is a wave 2 of an Elliot Wave cycle which will be followed by a massive wave 3 but I've stopped trading on wishes and started trading on technicals.
***This is not investing advice. All investors should seek guidance from licensed financial advisers and not random people on the internet.***
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
- $678 = 33%
- $599 = 50%
- $519 = 66%
We are already seeing the zone around the 33% retrace holding support. This is not surprising given that this zone held for almost 4 days between 4/27-5/1. If I had the ability to be a computer constantly I would consider daytrading at this level with a target of selling the position near the falling trend line around $705. However, I think this is a risky trade and I can't give it the attention it needs.
The next support will likely be around $599. I do not think it will give strong support and if we do retest it I suspect we will fall right through it toward the 66% retracement. Around $519 is where I hope to be a buyer if the market shows signs of reversal. If not then we may test the critical support levels of $400 and $360. Typically a retracement past 66% (or 61.8%) signals something more than a "correction." It often signals a broader trend reversal and I would expect to see accelerated selling and mass carnage. For my long term positions I hope this isn't the case. I hope what we are seeing right now is a wave 2 of an Elliot Wave cycle which will be followed by a massive wave 3 but I've stopped trading on wishes and started trading on technicals.
***This is not investing advice. All investors should seek guidance from licensed financial advisers and not random people on the internet.***