Lots going on this chart but lets start biggest to smallest. The bold red lines are our support and resistance when plotted on the daily chart, on the log scale. The pierce throughs are wicks on the daily but visible as several candles on the daily. The green circle shows we found support there for two 4H candles before the bottom fell out.
What I am looking for right now is for the MACD to wave down very similar to how it did mid-August, and then I expect us to consolidate and move sideways again. We will know the downleg is done when we see the RSI/Price action “V” similar to August 15th as shown by the blue lines (bullish divergence). I plan on closing my shorts when I see that (I have luckily been shorting since 284). Most likely we will have 3 waves down on this downleg but nothing is guaranteed. I would have preferred that our current low at $200-ish would have had the RSI a bit lower, so the RSI is something to watch closely. The MACD suggest so that The MACD shows we have completed wave one and are staged for wave 2. Those of you good at wave analysis if you could mock up a chart that would be appreciated.
For extra context we see hidden bearish divergence in Orange and standard bearish divergence in green. A reminder, bearish divergence is when you have a lower high on the price action but a higher high on the indicator (again, in orange) you will get a continuation of a down trend. We see a double top formation by using the indicators that isn’t readily visible on the charts by the green bearish divergence, which is a higher high in the price but a lower low in the indicator.
The big picture on ETHUSD is somewhat brutal. There is no buzz about a ETF for ETHUSD and the news around Ethereum competitors (Holochain and EOS) make the Ethereum project look uncompetitive. When you combine this with the global quantitative tightening EHTUSD looks like it is stage for a precipitous drop.
I think we will see the main chart play out roughly till ETHUSD is in the single digits. Hidden bearish divergence will tear any peaks apart, we may double top with standard bearish divergence and then move sideways, rinse and repeat. Somewhere between here and there we should see a full blow capitulation that makes trying to day or swing trade risky as you may miss out quite the drop. I know calling for “single digits” seems audacious but we were in the single digits in February of 2017 and the global market has changed a lot, and utility coins have changed a lot during that time as well.
What I am looking for right now is for the MACD to wave down very similar to how it did mid-August, and then I expect us to consolidate and move sideways again. We will know the downleg is done when we see the RSI/Price action “V” similar to August 15th as shown by the blue lines (bullish divergence). I plan on closing my shorts when I see that (I have luckily been shorting since 284). Most likely we will have 3 waves down on this downleg but nothing is guaranteed. I would have preferred that our current low at $200-ish would have had the RSI a bit lower, so the RSI is something to watch closely. The MACD suggest so that The MACD shows we have completed wave one and are staged for wave 2. Those of you good at wave analysis if you could mock up a chart that would be appreciated.
For extra context we see hidden bearish divergence in Orange and standard bearish divergence in green. A reminder, bearish divergence is when you have a lower high on the price action but a higher high on the indicator (again, in orange) you will get a continuation of a down trend. We see a double top formation by using the indicators that isn’t readily visible on the charts by the green bearish divergence, which is a higher high in the price but a lower low in the indicator.
I think we will see the main chart play out roughly till ETHUSD is in the single digits. Hidden bearish divergence will tear any peaks apart, we may double top with standard bearish divergence and then move sideways, rinse and repeat. Somewhere between here and there we should see a full blow capitulation that makes trying to day or swing trade risky as you may miss out quite the drop. I know calling for “single digits” seems audacious but we were in the single digits in February of 2017 and the global market has changed a lot, and utility coins have changed a lot during that time as well.
And I promise every Floridian that you will all be rich... because we're gonna print some more money! Why didn't anybody ever think of this before?
~Nathan Explosion
~Nathan Explosion
Recently double tops on crypto have developed over 5-15 days so this signal may be a bit premature. I also like to see divergence on a higher timeframe and if the divergence builds up onto a higher timeframe there will be a opportunity to enter this short from a higher position. All trading disclaimers about my being completely unqualified to give you financial/trading advice are still in play.