It is appearing more and more like most of the more popular cryptocoins are setting up for something exciting in the not-distant future. Let’s take a look at the daily chart of ethereum:
We have seen this chart recently. As should be immediately clear, and as the arrows highlight, pricetime has shown a remarkable affinity for the bull setup shown above. The rise and then sell-off of the last couple days has done absolutely no damage to this chart. The trend remains slightly upward. Note however that the area in blue, showcasing the present timeframe, is getting rather near the 5th arc pair – it will likely reach it by the end of the month. This is normally bearish, as the 5th arc pair on a bull setup is usually very strong resistance.
However, I have witnessed on many occasions when an asset traded flat to slightly higher, fighting for every gain it could get, until it reached the 5th arc. Then, once it finally passed through the 5th arc pair the price rose violently. This was the case in October 2013 in the days/weeks prior to the great bitcoin bull market of that time. So, knowing how much this chart looks like that infamous chart, I would be very hesitant to go short at the 5th arc. I might close long positions “just in case”, but remain ready to buy them back again quickly.
Here is a bear setup we looked at a few days back. Note that in the days since we last saw this, price is now sitting exactly on arc support. Of course, I may be wrong, but I have a feeling this support is going to hold.
Lets look at another bull setup from the recent low, where we see that price has moved into the 2nd arc pair. Price rallied as soon as it entered the pair, but pulled back to test arc support.
Unless we get a surprise break of support on the bear setup above, such that price breaks below that critical arc support, I have a feeling something good is getting ready to happen here….
Happy trading!
Remember: The author is a trader who is subject to all manner of error in judgement. Do your own research, and be prepared to take full responsibility for your own trades.
Featured image from Shutterstock.
