Ethereum: What now?! (ETCBTC)

POLONIEX:ETHBTC   Ethereum / Bitcoin
Hello again friends!
I'm feeling some extra motivation today(was it the coffee or red bull?) so I decided to browse through the high volume coins again. I've had some private requests for a ETHBTC diagnosis anyhow. So without further delay here we go!

I drew up a Fib retracement from a swing-low( candlestick low price with higher lows on both sides) on 23rd of January all the way up to our recent swing-high candle( candlestick high price with lower highs on both sides) on the 1st of February. Sometimes I like drawing these retracements, because when coupled with historical resistances, trend lines , and other indicators, they can be very powerful tools for market exit/entry.

As you can see, the 0.618 Fib line has been of particular interest, having been tested at LEAST 5 times. "Testing" means the top part of the candlestick may have went above the Fib line, but did NOT close above it. One could argue it happened even more than 5 times, but regardless, 0.618 is proving to be a short term significant resistance.

On the other hand you have the short term positive trend (green dashed line). This green little guy has been tested at least 3 times. Important to note: when you DRAW a line between two points, it does not become an actual TREND until it gets "proven" at least 3 times. Such is the case here. As I just mentioned, when trend lines and significant Fib lines meet (yellow circle), amazing things can happen.

Other indicators, such as the Stoch are signaling that this trend line may be tested at least once more. it may even be broken. If the later is the case, then any potential long position is negated and the bears will take hold. However, if the test of the trend holds up as it has in the recent past, a breakout could be in order. Remember: price action would have to CLOSE above the 0.618 Fib line to mean anything. The top of the candle wick going past it would just further prove the 0.618 Fib as a strong resistance, and would provide evidence for a downturn.

Now is NOT an amazing time to buy ETHBTC. I am simply noting a "long" position because if you had bought earlier, I wouldn't drop out just because this temporary drop in price. I would advise to put your stop-loss just below the green trend line if you are very conservative or just below the 0.786 if you're feeling a little more aggressive.

I will update with any new developments.

Best of luck. Stay healthy!

Comment: Check out the updated chart below. Seems that the 50 EMA(pink) is providing overhead resistance while the green trend line is STILL holding up after being tested a few more times since my last post. Based on the recent Stoch crossover, I'm still feeling somewhat bullish about the movement. We have not tested the 0.618 Fib for a little while though, so even if the 50 EMA is broken through, we still have that to conquer.

As I said before, not a great time to BUY. But, if you did buy, It would be wise to still hold until something more definitive happens at the support/resistances.

Trade closed: stop reached: As you can see folks, ETHBTC broke through the bottom trend line as the 0.618 FIB proved to be stronger. As a result, the downtrend continues!

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