Hi friends! Welcome to this update analysis on Ethereum! If you recall from my last analysis, titled "Ethereum Prints A Violent Breakout — Approaches Resistance" I was detailing the powerful resistance level (red circle) that ETH was running into. As you can see, that resistance came in the form of a convergence of the top of the uptrend channel, and the falling blue dashed trendline. If you recall from the last analysis, I said "ETH is trading inside of an uptrend channel at the moment, and it's currently reaching toward the top of it. Furthermore, there is a falling trendline of resistance (in blue dashes) that is slicing through the channel just above the current price action. Since both of those resistance levels are converging just above us, it's likely that we will see some form of resistance there. So, we need to keep an eye on this level, to see how ETH reacts. With that said, if ETH is able to confirm above this falling dashed trendline resistance, I think that will open the door to even more upside gains, potentially to around the 985 level. A failure to get above the falling blue dashed trendline , could send ETH back toward the neckline of the inverse head and shoulders pattern."
Since then, ETH failed at the dashed trendline, retraced to the INVERSE neckline, confirmed below it, fell below the uptrend channel, lost the 61.8% retrace, and it now appears to be in freefall, as traders search for support.
That's the micro view. On the MACRO view, you can see that what ETH REALLY appears to have done, is it has simply produced a failed attempt to rally above the neckline of the huge head and shoulders pattern that dominates the chart. If you recall from my past analyses, I've published many posts on the large head and shoulders there, beginning at the top of the right shoulder. Ethereum did print a nice breakdown from there, but it formed this inverse head and shoulders back into the neckline, causing the whole cryptosphere to turn bullish, and then it failed. Why did it fail? Because the larger, more dominant pattern is the head and shoulders pattern, and we were simply testing the neckline. As you can see, we are now back below the extended neckline of the huge head and shoulders pattern. On the upside, we can presume that it will act as resistance, should ETH go to test it. If we do test it, and we fail, that will be a fantastic sell signal. Technically, the breakdown below the pink trendline was a longer term sell signal, and it will also be a sell signal, if we see a confirmation below the 1200 EMA (in red.) Ultimately, I think that is a level that we are likely to revisit, in the very near future.
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-Magic loves you-
-JD-
Since then, ETH failed at the dashed trendline, retraced to the INVERSE neckline, confirmed below it, fell below the uptrend channel, lost the 61.8% retrace, and it now appears to be in freefall, as traders search for support.
That's the micro view. On the MACRO view, you can see that what ETH REALLY appears to have done, is it has simply produced a failed attempt to rally above the neckline of the huge head and shoulders pattern that dominates the chart. If you recall from my past analyses, I've published many posts on the large head and shoulders there, beginning at the top of the right shoulder. Ethereum did print a nice breakdown from there, but it formed this inverse head and shoulders back into the neckline, causing the whole cryptosphere to turn bullish, and then it failed. Why did it fail? Because the larger, more dominant pattern is the head and shoulders pattern, and we were simply testing the neckline. As you can see, we are now back below the extended neckline of the huge head and shoulders pattern. On the upside, we can presume that it will act as resistance, should ETH go to test it. If we do test it, and we fail, that will be a fantastic sell signal. Technically, the breakdown below the pink trendline was a longer term sell signal, and it will also be a sell signal, if we see a confirmation below the 1200 EMA (in red.) Ultimately, I think that is a level that we are likely to revisit, in the very near future.
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-Magic loves you-
-JD-