The recent drop in the market was a little overdue but that did not make it sting any less. Now the dust has relatively settled from that huge leg down, the question that will inevitably be asked by everyone is "what next?". "Do I have to liquidate my entire stash of digital beans and run for the comfy hills of Fiat as fast as my stubble little legs can carry me to escape the impending destruction of all the shitcoins I love and cherish?"
Well, not yet.
There are a number of things we need to look at to determine if market structure has really shifted to a bearish bias and one of the 'good' things about the parabolic run we had with ETH is that the huge sell off hasn't even dented the daily 200 ma. I'm a relatively simple man, the pa is above the 200 ema on the 1d, I'm long term bullish.
If you have followed my charting before, you'll know my two favourite TA tools are FIBs and Ich clouds. Ich can be fantastic for determining and clarifying overall market sentiment and key support and resistance levels and on this ETH chart we have one tasty cloud. The huge sell off yesterday bounced perfectly off the bottom line of the cloud (the Tenkan Sen) and today we have tested the top blue line of the cloud (the Kijun Sen). The cloud essentially acts as a dynamic support/resistance structure whilst giving us a peak into the future market sentiment as it rolls before the price. Essentially, if the cloud 'twists' and turns red from the blue Kijun Sen crossing below the red Tenkan Sen its a pretty good indication of a bearish market.
This has not happened, the future cloud is still green and lovely so, for now, the market sentiment is bullish.
Another TA I like to use is the Stoch RSI, here we can see severely underbought areas and backtest them against PA. ETH has had two similar massively underbought areas on 28/2 and 25/3 which both signified bottoms and predated new rallies. However, in the short term I would urge caution, this pa is messy and will chop heavily for hours in not days, wait for clear signs of a recovery before going full chimp mode.
Does the current PA signify a huge rally incoming for ETH? History does not always repeat itself, but it can rhyme.
Well, not yet.
There are a number of things we need to look at to determine if market structure has really shifted to a bearish bias and one of the 'good' things about the parabolic run we had with ETH is that the huge sell off hasn't even dented the daily 200 ma. I'm a relatively simple man, the pa is above the 200 ema on the 1d, I'm long term bullish.
If you have followed my charting before, you'll know my two favourite TA tools are FIBs and Ich clouds. Ich can be fantastic for determining and clarifying overall market sentiment and key support and resistance levels and on this ETH chart we have one tasty cloud. The huge sell off yesterday bounced perfectly off the bottom line of the cloud (the Tenkan Sen) and today we have tested the top blue line of the cloud (the Kijun Sen). The cloud essentially acts as a dynamic support/resistance structure whilst giving us a peak into the future market sentiment as it rolls before the price. Essentially, if the cloud 'twists' and turns red from the blue Kijun Sen crossing below the red Tenkan Sen its a pretty good indication of a bearish market.
This has not happened, the future cloud is still green and lovely so, for now, the market sentiment is bullish.
Another TA I like to use is the Stoch RSI, here we can see severely underbought areas and backtest them against PA. ETH has had two similar massively underbought areas on 28/2 and 25/3 which both signified bottoms and predated new rallies. However, in the short term I would urge caution, this pa is messy and will chop heavily for hours in not days, wait for clear signs of a recovery before going full chimp mode.
Does the current PA signify a huge rally incoming for ETH? History does not always repeat itself, but it can rhyme.