Let's look at the 4H chart of Ethereum and try to spot possible price movements and entry levels. We can see that the market is at the important zone formed by the uptrend line and 300.00 support level. If the price bounces from this zone and breaks the downtrend line from the 1H time frame, we'll get a signal of further upward movement. The market will rise to 320.00 resistance level. If the bulls are strong and pass through this resistance level, we'll get a confirmation of the uptrend. Our pending orders for buy can be placed above 320.00 level. But what if the price breaks the uptrend line? In this case we should expect for further downward movement to the next reversal zones. The reversal zone at 270.00 level is not so strong. We'll need strong confirmations for buying from this level. If the market drops below 270.00 level, the next zone will be able to stop the falling market. It is formed by 230.00-240.00 support levels and the uptrend line. This zone is a good place for opening long trades based on a confirmed buy signal.
Great chart. I agreed with it and even thought there was an inverted head and shoulders going on. Sadly BCH stole the scene. I dont think the market has really built up negative momentum but it will mean it will be a difficult slog for ETH to return back to a positive outlook
DLavrov writes, "But what if the price breaks the uptrend line? In this case we should expect for further downward movement to the next reversal zones. The reversal zone at 270.00 level is not so strong. We'll need strong confirmations for buying from this level. If the market drops below 270.00 level, the next zone will be able to stop the falling market. It is formed by 230.00-240.00 support levels and the uptrend line. This zone is a good place for opening long trades based on a confirmed buy signal."
The market has broken below the first reversal zone at 300.00.
The 2nd reversal zone is between 2017-08-19 14:00:00 and 2017-08-19 10:00:00
The 3rd reversal zone is between 2017-08-21 10:00:00 and 2017-09-05 22:00:00
So, this chart should still be active until the 5th of next month if the 230.00-240.00 support levels hold up.
clausjensen
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I would be interested in knowing where to take profit on this trade - do you have estimated target levels?
stonetat2
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You are the Master Dmitriy I gonna send you some coins to say thanks for your trading tipps.
MJMeetya
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Quiet honestly I do not think ETH is going down from here. With all the respect to @DLavrov I believe uptrend line is not drawn correctly here.
I've done similar analysis with different line and perspective yesterday, before today's push here:
graph -
PatrickBoutin
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Hello @DLavrov thank you for your advice! I was hoping you might help me better understand and interpret your analyses. When I read it, in my mind it seems that I read the opposite of what you mean so any help you provide would be greatly appreciated.
I understand the first part of your analysis up to “we’ll get a confirmation of the uptrend”. It is after that, that I think I am a bit confused. Specifically when you say “Our pending orders for buy can be placed above 320.00 level”, I am wondering why the buy orders should be set that high rather than a lower price point in order to capture more of the appreciation once the price recovers?
Later, you say “We'll need strong confirmations for buying from this level”. I am assuming that these signals would be the same at the 230-240 support levels than the ones we would watch out for at the 270 reversal level. So my question is: what kind of signals should we watch out for in order to confirm that it is safe to re-enter the market rather than wait for further price declines?
Thank you in advance for your time and help with this question!
Patrick.
Red_Dog
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@PatrickBoutin, You don't want to buy into the position prior to 320 because @ 320 you are more likely to have a good bull run. The confirmation is usually the RSI relative strength index. Keep following and you will learn alot from DLavrov. I am just a rookie myself
PatrickBoutin
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@Red_Dog, thanks for giving input. I understand that I want to be part of the bull run however don't I need to enter a position in order to benefit from it? So for example at this moment the price is $300 so won't I benefit more from the bull run if I enter now than if I wait until the price is over $320? What am I reading wrong here?
As for the RSI index. I see the pink area that spans from the 30 level up to about 70. I can see that between 8/5 and 8/9 RSI levels broke the 70 level and during that same time frame, price increased sharply from $220 to $300. Looking further back at the opposite scenario, it seems that when the RSI level falls below 30, price tends to decline. So it seems that while levels are between 30 and 70 price tends to be somewhat stable. Am I correct in my interpretation of the RSI index by thinking that the closer the level is to 30 the likelier we are to experience price drops while the closer the level gets to 70 and the likelier we are to experience price gains?
@DLavrov I hope you can also tell me if my interpretation of RSI is correct.