Rule 1: Wave 2 cannot retrace more than 100% of Wave 1
Rule 2: Wave 3 can never be the shortest of the three impulse waves.
Rule 3: Wave 4 can never overlap Wave 1
Guideline 1: When Wave 3 is the longest impulse wave, Wave 5 will approximately equal Wave 1
Guideline 2: The forms for Wave 2 and Wave 4 will alternate. If Wave 2 is a sharp correction, Wave 4 will be a . If Wave 2 is flat, Wave 4 will be sharp.
Guideline 3: After a 5 wave impulse advance, corrections ( ) usually end in the area of prior Wave 4 low.
Using these rules and guidelines of Theory we can make projections for Ethereums correction.
Rule 1: Wave 2 indeed did not retrace more than 100% of Wave 1
Rule 2: Wave 3 is the longest impulse wave.
Rule 3: Wave 4 should therefore never touch 8.89934; it did not.
Guideline 1: Wave 3 is the longest impulse wave. This suggests Wave 5 will be a small +/-3 points in length.
Guideline 2: As Wave 2 was a this suggests Wave 4 will be a sharp correction. Indeed there was a flash crash on May 7th, 2017.
Guideline 3: The 5 wave impulse looks likely to complete at the 89.50 level. The prior Wave 4 low suggest a correction as low as the 26.00 level.
In the current form the begin of a correction indicates the price target as follows:
Wave 4 low - 26.00
From December 2016 ETHUSD has followed a parabolic uptrend.
The 14-period is showing 1D and 1W unconfirmed highs (losing momentum) whereas the 1M is overbought at 92.675 with a confirmed high (continuing momentum).
Beginning March 2017 has decreased consistently. This indicates a reducing inflow of money into Ethereum . The decreasing either signals the flow of money from Ethereum into Bitcoin on the back of its recent rally.
Fundamentally, the stall in this rally may be caused by the imminent hard fork to the Ethereum network protocol. The date of which is currently not known.
In the near term I can see a struggle for Wave 5 in edging closer to the significant 100.00 whole number. In the long term I am on ETHUSD with a price target of 26.00. If this current move results in the end of this impulse wave then by the rules of Theory the price of Ethereum should test around the lows of Wave 4. I believe the hard fork to come in the network is causing uncertainty which is hinted at by the consistently decreasing .
Im an active miner of XBT and ETH so these are hedges against volatility.