TL:DR - Expecting range bound activity for the next 6-12 months. Currently at the lower end of the range which is a good buy opportunity.
This is the ETHUSD chart with 1 day candles zoomed out over 8 months. For the last month we have seen range bound action in the price of Ether. The high being around $500 and the low around $425. I meant to post a bullish outlook on 7/15 when I posted my bullish Bitcoin H&S formation but ended up not having time. What is interesting is that while Ether did have a positive day it has failed to maintain its gains and fallen back to the bottom of the channel. If you look at CoinMarketCap you'll see that just about every coin has done the same thing, with the exception of Bitcoin. Why?
To answer let's take a look back. Last year we saw periods of Bitcoin dominance, where BTC skyrocketed and sucked all of the money out of the alts. The last week has felt somewhat similar and I can tell you the reason: BitCoin ETF. I'm not saying the BTC ETF is going to be approved, no one on TradingView knows that. But people anticipate its approval. Unlike BTC futures, which merely removed buyers from the BTC markets by allowing investors to go long without actually buying the BTC (remember the BTC futures contracts do not result in any buying or selling of Bitcoin, it is purely cash settled). An ETF on the other hand will be backed by actual BTC. This means any investor, even the most technologically uninterested and illiterate, can buy BTC. The expectation among traders is that this will fuel the next leg of BTC FOMO. Unfortunately Ethereum, and no other crypto for that matter, has no talks of an ETF yet. While in very long term I am more bullish on Ether than I am on BTC I can't ignore the short and medium term implications of a BTC ETF.
With that being said let's look at the chart patterns. There are multiple patterns potentially forming and breaking. Most notably we appear to have broken the multi-month downtrend line going back to Ether's all time high. Personally I would have liked to see price put more distance away from this line than it has which makes me hesitant to call it broke, it may just need to be re-drawn a little. With that said the even broader uptrend line going back 13 months remains as support which we are testing now. I am doubtful we break below this line.
I did not leave it on the chart but we are potentially forming a broad rounded bottoming formation which could lead to a Cup and Handle bullish formation. Starting May 6th price has gone down but with decreasing velocity. If we see price form the other side of the cup in a rounded formation then we could see $800 followed by a brief drop and then a sudden breakout to $1,000. I am not saying this will happen but it is a possibility. It will take 2-3 more months for this pattern to form so keep an eye on it.
As I have said in the past, I expect this market to trade in a broad range bound area for the next 6-12 months. Ether needs news: an Ether ETF, Casper, Sharding, PlasmaCash release, something to attract new investors and get people excited. Until this news comes I plan to trade the highs and lows of the channel. If you can't tell from the chart, right now is still a time to buy.
***This is not investing advice. I am not an investing professional. Do not invest what you cannot afford to lose. All investors should seek guidance from licensed financial advisers and not random people on the internet.***
This is the ETHUSD chart with 1 day candles zoomed out over 8 months. For the last month we have seen range bound action in the price of Ether. The high being around $500 and the low around $425. I meant to post a bullish outlook on 7/15 when I posted my bullish Bitcoin H&S formation but ended up not having time. What is interesting is that while Ether did have a positive day it has failed to maintain its gains and fallen back to the bottom of the channel. If you look at CoinMarketCap you'll see that just about every coin has done the same thing, with the exception of Bitcoin. Why?
To answer let's take a look back. Last year we saw periods of Bitcoin dominance, where BTC skyrocketed and sucked all of the money out of the alts. The last week has felt somewhat similar and I can tell you the reason: BitCoin ETF. I'm not saying the BTC ETF is going to be approved, no one on TradingView knows that. But people anticipate its approval. Unlike BTC futures, which merely removed buyers from the BTC markets by allowing investors to go long without actually buying the BTC (remember the BTC futures contracts do not result in any buying or selling of Bitcoin, it is purely cash settled). An ETF on the other hand will be backed by actual BTC. This means any investor, even the most technologically uninterested and illiterate, can buy BTC. The expectation among traders is that this will fuel the next leg of BTC FOMO. Unfortunately Ethereum, and no other crypto for that matter, has no talks of an ETF yet. While in very long term I am more bullish on Ether than I am on BTC I can't ignore the short and medium term implications of a BTC ETF.
With that being said let's look at the chart patterns. There are multiple patterns potentially forming and breaking. Most notably we appear to have broken the multi-month downtrend line going back to Ether's all time high. Personally I would have liked to see price put more distance away from this line than it has which makes me hesitant to call it broke, it may just need to be re-drawn a little. With that said the even broader uptrend line going back 13 months remains as support which we are testing now. I am doubtful we break below this line.
I did not leave it on the chart but we are potentially forming a broad rounded bottoming formation which could lead to a Cup and Handle bullish formation. Starting May 6th price has gone down but with decreasing velocity. If we see price form the other side of the cup in a rounded formation then we could see $800 followed by a brief drop and then a sudden breakout to $1,000. I am not saying this will happen but it is a possibility. It will take 2-3 more months for this pattern to form so keep an eye on it.
As I have said in the past, I expect this market to trade in a broad range bound area for the next 6-12 months. Ether needs news: an Ether ETF, Casper, Sharding, PlasmaCash release, something to attract new investors and get people excited. Until this news comes I plan to trade the highs and lows of the channel. If you can't tell from the chart, right now is still a time to buy.
***This is not investing advice. I am not an investing professional. Do not invest what you cannot afford to lose. All investors should seek guidance from licensed financial advisers and not random people on the internet.***