Ethereum - After a week of ranging the scenario hasn’t changed..

Welcome traders, I hope the universe is treating you well. Let’s have a quick look at Ethereum.
The chart above is a nice overview of the longer term market. We can we we’re still in a bear market, coming into the kumo. We’re correcting the last move down, after which there is no reason not to expect another move down, reaching for he bottom of the channel (under 300…). Keep that in mind while we discuss a potential swing trade going long.
We had a scenario developing into a trade setup in the beginning of last week, and after a week of ranging, that scenario is still at play (see the link at the bottom of this post for last weeks scenario). And after a week of calm, it is likely this week will be volatile again..
Let’s look at the charts to see what happened last week, and where we are now.


Daily

As we can see here, we’ve been ranging within the channel as we expected. Ichimoku is moving into complete equilibrium with the price, kijun and tenkan-sen moving into the kumo. We’ve got 3 clean waves and are looking to get in on the extended 5th wave, which we have a high probability of seeing if we break the breakout level at around 495. Now it is possible that we had a failed 5th wave last week, reaching to around 480, which completes our 5 wave count. We don’t know yet, nobody knows yet. If price breaks through the breakout level we have a high probability that it wasn’t. If price breaks through the blue support zone it’s hanging on to now, it’s probably a failed 5th wave, and we’re going down.. At the moment we’re sticking to our scenario, until we are proven wrong. If we breakout, our target is the confluence zone of around 565. There’s a few things to note about that: First, if we get 5th wave, its possible that he bull won’t be strong enough, and it won’t be an extended impulse. We would have to see the wave develop first before we can more accurately asses its momentum. The first resistance area it will face is around 540, so we’ll have to watch this if the trade gets activated. Second, it’s possible that the bulls are stronger than we expected, and push higher. Again, when we get there we stick to our plan of taking our profit at the max target, and then reassess the situation with the information the market gives us.


2HR

The 2HR timeframe doesn’t really give us any more information. We’re ranging, and waiting for a breakout. If we see signs of this setup failing, i.e. we break the blue support heading for the invalidation level, we’ll start looking for bearish cycle signals to get into a short position there.

Breakout: 495
Target: 565
Invalidation: 438

Like and follow us for market outlooks and more trade setups!

Comment:

Just a quick update on our setup now that the price dropped and everyone seems to be panicking. We’re still waiting, nothing has been activated yet, but we do have some developments.

The charts:

Daily

We’ve got 2 entry points: a more speculative long entry on the pullback, and a breakout level entry (with higher probability of reaching the target). To take the long entry on the pullback we need price to reset the momentum a bit, and then come down again for a retest. If we get a signal in that area, we’ll take a speculative entry into the long, with our stop below the invalidation.
It’s also possible the support doesn;t hold, and we break down. We’ll need some resetting to happen before considering a short there too. If this becomes apparent, you will of course here from us again

2HR

The 2 hr shows us signs of bearish exhaustion, as the distance between the price and tenkan is large. We’ll wait for some kind of momentum reset and then look for bullish entry signals, which if they come, we will give you!
Again, breaking the previous swing low means game over, and we’ll have to reassess to find safe short entries.

Follow and like to get notified when we update the ideas, and to find out whether we get a good entry signal or not…

Comment:

We're flirting with the invalidation area, but it seems to be holding for now. waiting for maybe a small test downwards again to reset the cycles. Looking for a signal to enter there.
We will update when we've got a clean signal to enter the long for a 5th wave up!

Comment:

we;ve been hanging in the invalidation zone for some time, so we had to re-evaluate the situation. Here's the new scenario:
(click on the image for the post)