ETHUSD Update: I am still long from 298.84 while watching this market unfold in a tight range. I have placed an order to sell half of my position at 289.50 which will leave me with 15% of my normal position size with a stop at 279. When a trade is not behaving the way it should, then it is time to reduce risk.
So here is my plan: If 290 breaks, then I want to see how price behaves in the mid 280s which is the .618 of the recent bullish swing. If price falls below that, then 270 is the next support which held previously (I wrote about the importance of this level in my previous report). If the 280s hold, I will look to add back to my small position, if 279 is taken out, then I will be fully stopped out.
IF price breaks below 270, that will open the door for a retest of the 250 level which is also a key support for a number of reasons. It is a 1.0 extension measured from the highs, and it is also within the .618 support zone of the entire bullish structure that led to the 355 swing high.
If I get fully stopped out at 279, I will not reenter until I see bigger picture momentum showing clear bullish signs. At the rate this market is moving, that may take a couple of weeks. Keep in mind, the type of trade I am focusing on is a swing trade. There are more frequent opportunities both long and short on the smaller time frames if you are looking for more action, but you must be quick on the trigger and be extremely flexible with your decision making. Being caught with an opinion on the wrong side can be expensive.
Right now, I am leaning more on the bearish side because a strong market spends more time messing with highs, rather than lows. A break below 290 will establish a lower high formation and that often leads to further weakness which means the oncoming supports are more likely to break. Not exactly a good environment for longs.
In summary, I am more interested in reducing risk at the moment. If price retests the 280s or low 270s and shows significant support and reverses, I can always get back in after some confirmation. Strong markets push resistances, not keep testing supports. I am still holding a small portion long with a stop for half at 289.50 and the other half at 279 to give this market a chance to prove it has strength in the 280s and negate the current bearish environment. Let's see what happens.
I fail most of the time when I try to apply logic recently, so I'll listen to my guts this time and stay in fiat.
Too much uncertainty for me with the upcoming bitcoin fork. I'd short BTC but I don't trust that as well with the level of manipulation going on there.
MarcPMarkets
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@Iruwen, you make a good point. The forks are definitely skewing things.
wojkucz
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@MarcPMarkets in my opinion this all ETH analisys is pure guessing. Not long ago You were telling us that ETH will hit 400$ and now You convincing people to be carefull with investing money because of price swing. People do follow Your profile and You should be more responsible with inviting them to invest money in something that neither them nor You understand. Please don't get angry about my comment - it's only opinion
deveci.as95
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If we use the daily chart and throw a pitchfork on it (july), we can see that the theoretical price would be at least around 700.
IvanSavon
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@deveci.as95, Yes, proceeding from this logic, etherium and lightcoin had to start a significant growth in price. But this does not happen in connection with the tug-of-war market capitalization of bitcoins and its forks. Although these forks do not represent anything too much interesting. Most of all, I am amazed at the ever-decreasing volume of trading in the etherium, lightcoin and other TOP altcoins. This is a strange signal, isn`t it?
AlaaElmahdy
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@IvanSavon, no it isn't today one of my friends who hodl his BTC during the fork told me he sold his BTG for 600 so you can't ignore the greed in people eyes, this guy and lot other guys take out all them money from ALTs and bought BTC for the free coins and still we will see more money going out of ALTs till the mid of nov. till the Segwit fkn Fork done.Later when the free icecream finish every one will sell BTC and back to ALTs if it still exist at that time as BTC will flood every thing to the bottom of the see.
MarcPMarkets
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@AlaaElmahdy, thanks for sharing, yeah it seems clear that the fearless BTC buyers are betting on the free money.
MarcPMarkets
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@IvanSavon, the BTC free money proposition is attracting all the investors. When the fork is out of the way, I am curious to see how the alts behave.
Gaengphed
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Thank you for this insight! About 'the trade is not going the way it should - reduce risk'...I have the same feeling with ZCash t the moment. Stepped in at 238. Thanks again, very helpful with decision making!
MarcPMarkets
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@Gaengphed, glad you learned something helpful. That is why I write these analyses.
Too much uncertainty for me with the upcoming bitcoin fork. I'd short BTC but I don't trust that as well with the level of manipulation going on there.