Eth: 2 Descending Triangles, a double top, Elliot wave, pennant

BITFINEX:ETHUSD   Ethereum / U.S. Dollar
I was meant to do my write-up and 3rd update of Ripple as mentioned in my last idea however, the last idea ended in a loss and I personally feel that the idea was rushed and did not have my best analysis in it. Also, I don't like losing, so I'm revisiting Ethereum one more time with a more deeper technical analysis for the next week.

The price of Ethereum is currently trading within a larger descending triangle (shown in orange) and price has nearly retraced to the base of the triangle at 280.5. However, deciding that price will return to 280.5 based on this alone is not a strong argument. Price has also recently broken out of a smaller descending triangle (shown in red), the price target it should fall to, should be the height of the triangle. Extrapolating this on the chart, it supports the move to a price of $280.5-282.

The price of Ethereum is also currently in the 4th Elliot wave trading in a rising pennant . To determine the price target based on the Elliot-wave, the 5th wave should be approximately the same length as the first wave. Placing this on the chart, we again reach the price target of 280.5(Shown by the yellow price boxes). In this 4th Elliot-wave as mentioned, we are also in a rising pennant (shown in the purple trend-lines). Thus, in the short-term, about 5-10 hours, we should first see a rise from now and a high possibility of a break-out of the pennant downwards. Price target based on the pennant is based on the height of the move into the pennant . Again, we obtain a target of high 270s or low 280s(Shown by the aqua price boxes). To time when the price will reach the target, we base the time it takes for wave 5 to complete as the same time it took for wave 1 to complete. This would be 16 bars/hours from the height of wave 4. Note that wave 4 as shown on the chart is incomplete as we are in wave 4 at the moment. When it breaks out of the pennant , then the time estimation is 16 hours from that point.

A weaker pattern also supporting the move to the low 280s would be the double-top pattern (shown in white). This pattern is based only on closing prices and therefore makes it weaker.

The following patterns mentioned are to support the move downwards to a target of $282. At this point, I believe that price will have a higher chance of rebounding rather than breaking out of the larger descending triangle . Price has traded less than 50% of the width of the descending triangle (140bars/321) making a break-out at this point not likely. Furthermore, volume has recently been decreasing (shown in the aqua trend-lines at the bottom, in the screenshot), therefore lacking the power to break-through. However if there is a spike in volume and a break-out downwards, the new price-target would be around 250, although it is very unlikely for this to happen.

Going back to the time it takes to reach the first price-target, if price reaches the first target($282) (shown by the first red arrow), then the rebound to the apex of the small inner triangle is highly likely. At this point, price can rebound again or break-out, where the former is more likely to happen. If a break-out occurs, price will move to break-out targets with: a first target of $305.17, second target of $315.6 and a third target of $322.67. If price rebounded at the apex of the inner triangle, then price will follow the 2nd red arrow and finally the 2nd green arrow in the orange triangle, breaking out at around 80% of the width of the descending triangle (256/321bars).

Backtracking to the first price target ($282), If price reaches the first target following the aqua arrow, price will most likely skip to the final green arrow break-out. Rebound is expected here as most reversals occur at the time of the apex of the descending triangle .

A break-out at the the 80% point of the triangle is likely to reach the 3rd break-out price target as mentioned.
Comment: As always feedback is always welcome!


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