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Patience is paramount to successful trading in any market. We have seen throughout the history of Ethereum (ETH) that certain patterns and fractals have been repeating over and over again. It is thus important to take them into account and be patient and let them play out because most of the time things are not as complicated as we like to think. For instance, the 4H chart for ETH/USD shows us how closely the price is following the same fractal as the one from the last week of September when the price was setting out to rally after a crippling crash.

Just as the price retested the 38.2% fib extension level and declined slightly lower than that, we have seen the exact same thing repeat and the price is now beginning to rally from there. The next big move from here could see Ethereum (ETH) rally as high as 20% from current levels with minor pullbacks along the way. This would be perfect for ETH/USD to test the 200 moving average on the 4H time frame as well as the previously broken market structure before the next decline. If we have a rejection at the previously broken market structure around $177, we can expect a decline back within the descending channel. However, if the price ends up rallying much higher from there towards $200 then something different might be at play here and we would have to be very careful being bearish on the market.

So far, this seems like a good time to hold on to your Bitcoin or Ethereum and wait for the market to rally much higher. Based on how the market reacts there, we can consider being long or short but for now there is no point in being bearish on the market. The 4H chart for ETH/BTC gives us another reason not to be short on the market just yet and that is the near-term outlook of Ethereum against Bitcoin.

We can see on the chart that Ethereum (ETH) has found a strong support against Bitcoin above the 38.2% fib extension level which means that it could rally higher from here. Cryptocurrencies rising against Bitcoin (BTC) is always a good sign for the market because it means that investors are not afraid of taking risks and being optimistic near term. Before the next big downtrend comes into effect, we will see retail traders become more confident and more hopeful in the beginning of a new bull run.

Jefe Caan , 2019-12-05 00:00:00 ,

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.

While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Featured Image from Shutterstock

Nick Chong , 2019-11-10 12:00:38

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