Community post
Ethereum: Harmonic Outlook
Traders, I advise you to read this entire post to gain a better understanding of what I'm looking at.
It's been a while since my last trading position on ETH, back in August price completed a valid bearish bat pattern (shown on the chart) which was followed by a decline of almost 50% in two weeks.
Taking the time to reflect on Ethereum's situation from a technical standpoint the future direction is now becoming far clearer.
It has been struggling to break the 400 is on the horizon.
Today I'm going to break down every aspect of the chart and explain in detail what I feel is happening from a technical perspective.
We're on the 4h chart with ETH/USD.
1. Bearish bat
The measurements for a valid bat pattern are detailed below.
B: 0.382 - 0.50
C: 0.382 - 0.886
D: 1.618 - 2.618
Final X to D: 0.886
A closer look on the 4h chart at my previous pattern, take profit levels 1 & 2 were achieved in a relatively short time period.
2. Daily price structure
Right now price is trading within a small zone, between a minor resistance and newly formed support trenldine, which aligns with levels A & C of the bearish butterfly .
3. Bearish Butterfly
The measurements for a valid butterfly pattern are detailed below.
B: 0.786
C: 0.382 - 0.886
D: 1.618 - 2.24
X to D: 1.272
It's not uncommon for harmonic patterns to occur one after another, especially with the previous pattern securing a nice return.
Currently price is completing the C to D leg of this structure and I estimate the pattern will complete on the 30th of November based on my measurement rules shown below.
The amount of time it takes price to form X to B is the projection for B to D.
Now remember, this is not certain... There will be many times when patterns take 2x longer to complete and still result in a profit.
I am only using my common principles to accurately determine the completion of the pattern.
4. Current price action
I would focus on the basics as of right now, I'm looking for a break of minor resistance and the support trendline to hold in order for the bearish butterfly to complete.
In the near future I will update this idea with my thoughts on Ethereum.
If we experienced a situation where the following happened.
It would still be a valid setup, as long as the C point does not exceed 0.886 and the lower trendline support is in tact.
If the bearish butterfly pattern completes I will let everyone know if it is a good area to short or close long positions, what we may find it the future is price pushes to around $520 at a 1.618 extension .
Click here to view my original post on TradingView.
Don't forget to upvote, resteem and follow me for in-depth market analysis and investing education.
Replies (8)
img credz: pixabay.com
Nice, you got a 32.0% @ak2154 upgoat, thanks to @lewisglasgow
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Congratulations! This post has been upvoted from the communal account, @minnowsupport, by Lewis Glasgow from the Minnow Support Project. It's a witness project run by aggroed, ausbitbank, teamsteem, theprophet0, someguy123, neoxian, followbtcnews/crimsonclad, and netuoso. The goal is to help Steemit grow by supporting Minnows and creating a social network. Please find us in the Peace, Abundance, and Liberty Network (PALnet) Discord Channel. It's a completely public and open space to all members of the Steemit community who voluntarily choose to be there.
Nice work .for graphs 👍 @lewisglasgow
Thank you 😄 @samiurrehman10
Have a look on my collection sir @lewisglasgow if u dont then
DAMNNN Technical analysis game ON POINT! Awesome post. thank you!!
@molfzart92 appreciate it man :)