Hi friends! Welcome to this update analysis on Ethereum! Let's get right to it. Looking at the four hour chart, you can see that ETH has broken down from the purple bear flag, just as anticipated. If you recall from yesterday's ETH post, I said "be on the lookout for a breakdown of the current bear flag , as the 20 EMA (in blue) begins to cross into the flag formation, increasing the likelihood of a breakdown. From there, look for a breakdown below the neckline of the large head and shoulders pattern." So, you can see that the 20 EMA was resistive, and it produced a bear flag breakdown. ETH is now moving in to test the neckline resistance of the massive head and shoulders pattern, so we will have to pay close attention to the price action around here. If ETH breaks down, the initial support is at the 78.6% retrace, followed by the 491.90 level. A break below there, could open the door to a swift decline down to the 385.20 level.
The MACD appears to be moving to form a bearish crossover, so the momentum appears to be returning to the downside swing, after breaking down from the bear flag consolidation. On the upside, I would continue to expect the 20 EMA to be resistive. Judging by how quickly ETH has returned to the neckline support (in red.) I would expect that a breakdown could occur in the coming days. Good luck trading, comrades!
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***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
Second major bubble burst pattern i assist in my life, and i am always amazed by these patterns human behaviour tend to repeat again and again.
The first one was the Dot com bubble, i was around 17yo.
Some of my family members were trading the Nasdaq stocks, i saw their behaviour in greed, denial and fear phase. Priceless memories that will always keep me remaining cautious with new hype markets.
Such an amazing race, from the bottom to another new Dot com bubble pattern currently beeing formed (have a look at Amazon stock since it exists and face the new bubble pattern beeing created).
moorbles
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Ultimately, ETH's fate pretty much depends on what BTC does, like 99% of the rest of the market.
Noodley
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@mattgarbutt, Completely agree, but ETH is taking this way worse than a lot of others. I mean hell, we're already well below the 2/6 crash. Low $400 wouldn't surprise me.
smashfootball
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@Noodley, agree, %wise ETH has had far more damage than BTC or LTC. When it's time to buy back in, I'm thinking ETH or XRP (maybe combination) will give the most bang for the buck on upside.
Noodley
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@smashfootball, Can't go wrong there. My "Post Crash" portfolio is going to be made up of XMR, NEO, XRP. These all just have WAY too much upside potential. Additionally, I believe their use cases make them extremely undervalued once adoption comes in time.
don_sanders
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@Noodley, ETH hasn't taken it worse than BTC. It's just lagged behind. BTC corrected to about 30% of ATH on 02/06. ETH only went down to about 40%. Expect ETH to hit 25-30% on this round like BTC did on 02/06.
VuAnhaa
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@Noodley, consider Eth/btc chart, that's why it's worse than other :)
Karonte
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the question i keep doing to you is: when the correction ends?
Second major bubble burst pattern i assist in my life, and i am always amazed by these patterns human behaviour tend to repeat again and again.
The first one was the Dot com bubble, i was around 17yo.
Some of my family members were trading the Nasdaq stocks, i saw their behaviour in greed, denial and fear phase. Priceless memories that will always keep me remaining cautious with new hype markets.
Such an amazing race, from the bottom to another new Dot com bubble pattern currently beeing formed (have a look at Amazon stock since it exists and face the new bubble pattern beeing created).