2/12/18 (4:29pm EST):
Short Entry (845) Target (500) Stop loss (930) <Possible bear trap>
Logic :
ETH like all cryptos are in a downtrend, consistently fallen and bounce off key support and fib levels after brief capitulation of about a week or so. Afterward, the price action rolls over and the volume increases to the downside until it reaches the next support or fib level.
Typically ETH falls 2-3 standard deviations (stdevs) from its previous bounce peak and then jumps ~30-70% before losing ~50% again and retesting lower support levels (which typically coincide with previous support or fib levels). The high from this most recent bounce was $900, which makes the expected drop range ~450; which happens to coincide with where the next large support range is and 0.382% fib levels. $500 is a round number which usually means bids will enter the market around that level. I expect the selling to touch $450, but want to sell my shorts into the bids coming in at $500 to make sure I get out.
Obviously, this historicism of trading works until it doesn't, so I will keep a close eye on when this trend reverses and adjust my expectations and strategy accordingly.
Short Entry (845) Target (500) Stop loss (930) <Possible bear trap>
Logic :
ETH like all cryptos are in a downtrend, consistently fallen and bounce off key support and fib levels after brief capitulation of about a week or so. Afterward, the price action rolls over and the volume increases to the downside until it reaches the next support or fib level.
Typically ETH falls 2-3 standard deviations (stdevs) from its previous bounce peak and then jumps ~30-70% before losing ~50% again and retesting lower support levels (which typically coincide with previous support or fib levels). The high from this most recent bounce was $900, which makes the expected drop range ~450; which happens to coincide with where the next large support range is and 0.382% fib levels. $500 is a round number which usually means bids will enter the market around that level. I expect the selling to touch $450, but want to sell my shorts into the bids coming in at $500 to make sure I get out.
Obviously, this historicism of trading works until it doesn't, so I will keep a close eye on when this trend reverses and adjust my expectations and strategy accordingly.
Comment:
2/21/18: stopped out of original play. I failed to spot the changing market environment and bias. Although I can see ETH retesting the $700 level, I decided to wait and see first. My timing has been about 1 week off thus for my trades, so I will reassess shortly.
Comment:
Original notion of expectation that ETH will follow any movement with overall market was correct and that a retest of 700 or more correct. Again, my timing was about one week too early. It has since blown past that target currently sitting at 607. It is very oversold right now so I would anticipate an uptick with a subsequent meandering until sometime next week. I think what happens in btc will ultimately dictate which way ETH breaks. If btc falls, I would expect ETH to retrace all of its 2017 holiday gains and find short term support around 475 level with an possible eye for 0.236 fib level at 333 level.
