botje11

ETH, Volume Drop inside of Bull Flag, Good or Bad?

BITMEX:ETHUSD   ETHUSD Perpetual Futures Contract
The strength ETH has shown the past few months, is not something we have seen continue the past weeks. The 280ish has been quite the resistance lately and so far it looks like a big bull flag in the making. We always want to see volume drop during bull (or bear) flags, but usually also want to see some differences within the flag. Like this last push up from past week, should have shown a bit more volume increase. I am just not seeing it so at this point it doesn't feel right to assume we will simply break the flag and rally above the 300.

On the right, we can also see how that small uptrend broke and at the moment we can see it is retesting it as resistance. There are 2 options with something like this:

1) The uptrend (blue line) broke but we will not see a big drop and instead seeing a bull flag form. So a drop to 260/265 could still be bullish for the short term. Volume plays a big role here. We can see a bit of volume increase when it drops, but should be like double the other drops.
2) The dropping volume on the left (which shows bearish divergences) is the last high for the coming period. To get this confirmed we need to see a big sell candle form straight through the 260ish. So for the short term, the only real danger i see is this. For the rest i think it's best to assume that bulls are still in control.

We can see that the 250ish can also be like a backup for the ETH market. As you might remember from previous analysis, the 230 is still THE biggest support zone between bull and bear trend (mid-term). The previous test of that level we could see that bears simply failed to show volume , so instead of a drop we have seen a counter move since. You can look back at one of my previous Bitcoin analysis to see what i had shown there. Where the H&S got turned into a bullish wedge and so far that has played out.

Also good to keep an eye out on Bitcoin , we just had a 200 point bounce up from today's low, which is keeping the triangle alive. But if we do see it turn down again, and break today's low, i don't see another real support level until the 8800/8900. If that happens, the double top version becomes very likely and i think that ETH will break it's support as well. Think the Bitcoin price 8200/400, will be the same as the 230ish for ETH.

So in general think we can say is:

We either just continue the rally from current high prices, or we are going to make that big correction, to test the long term support levels and give foundation to this whole rally and continue with the bull market. Until this doesn't happen, to me it means that a 10/20% daily drop will keep looking around the corner, since we have not set a real foundation yet.
Short term for the bulls, the 272ish is the first step for the bulls.



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Previous analysis:
Comment: Was this BTC analysis where i showed that wedge/H&S on ETH
Comment:
Comment: ETH dropped quite nicely and so far following the path of the potential bull flag. The drop however looks a bit controlled and so far following this channel.

Now the confusing thing is, BTC looks weaker on the short term, while ETH looks like it might break this channel. The 266ish seems to be the first level of the bulls to break. Then the short term bearishness might be over.

Comment: ETH broke out quite well, but the volume is not very convincing yet to think this big bull flag will play out. So think we might still see a retest of support, best case for a bull flag to see a higher low.

The red zone on the left seems to be another resistance now. Think if the bull can break it, it will give the bull flag at least more chance of succeeding. Still all not very clear yet, because Bitcoin is showing a few different signs.

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Still hovering within your channel. Very curious to see if we are going to break below or above it. We still have a lot of bull momentum.
We're up 7.12% and have a stop loss set for the long trade to catch us and then we are going short. Thanks for the update and all you do man, love your ideas, they help a lot!
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Look al ltc, it sometimes makes the move before the rest ones, I just trade Btc Eth and Ltc. It just broke the correction triangle it was in. Take a look
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Hi botje, what do you think about this idea? we scalped from 8900-ish to 9100 usd. I used leverage. Beginners luck?
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Eth is slow in up movement as compare to btc: ETH upside in monthly not complete will go up: while btc up wave in monthly over:)
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