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Ethereum (ETH) has shown some signs of bullishness recently but now it is beginning to be forced to remain below the 38.2% fib extension level. There are now two possibilities at this point. Either we will see the price break out of the symmetrical triangle to potentially pump again like before or we will see it break trend line support to enter a strong downtrend. So far, ETH/USD remains well above the 200 MA on the 4H time frame. However, things do not take long to change in this market. In my opinion, a lot of people are now waiting for this decline which is why I would not be surprised if we see another pump near term.

However, the focus should remain on the price eventually breaking this downtrend because that is what is going to happen sooner or later when the dust settles. Most new traders blindly rely on classic technical analysis knowledge in this market which could prove to be dangerous. For instance, you might see a gravestone doji on the 4H chart and think the price is ready to decline from there. However, that is not what necessarily happens in this market not when the volume is this low and the stakes are this high. Please note that it is very likely that a gravestone doji is followed by downside on the larger time frames but on the smaller time frames anything is possible which is why it is very important to remain vigilant and practice effect risk management.

The 4H chart for ETH/BTC shows that Ethereum (ETH) has now entered a short term uptrend against Bitcoin (BTC). Whether or not this uptrend is sustainable has yet to be seen but as long as the pair remains above the 200 MA, we can expect it to rally further. This is a sign that Ethereum (ETH) and other altcoins might yet make more moves against Bitcoin (BTC) before the beginning of a strong downtrend.

Every market moves in cycles. There are periods of uptrend and downtrend. In this market, what we have seen so far since the beginning of 2018 has been a strong downtrend which was followed only briefly by a strong uptrend. The major downtrend is not over yet despite the bullish phase in between. This is why it is very important to remain focused on the big picture. Even though the market could still pump higher from here, the focus should be on selling and not buying at current levels.

Jefe Caan , 2019-11-12 22:00:00 ,

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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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