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Oct 17, 2020 at 10:38 // News

There are indications that sellers may push Ethereum below the moving averages

On October 12, the biggest altcoin faced rejection at the $395 overheard resistance. After Ether was repelled the coin dropped to $368 low.

There are indications that sellers may push the coin below the moving averages or the critical support at $350. This may portend negatively for the coin if the bears are allowed to have an undue advantage at this price level. 

For example, if Ethereum retraces and finds support above $350, the upside momentum is likely to be revived. Buyers will attempt to push the price above $395 overhead resistance. This will catapult the coin to $488 high. On the other hand, if the bears break the $350 support, Ether will fall to the previous low at $310. A break below the $350 support will automatically affect the breaking of the moving averages. Perhaps, Ether will be range-bound in the bearish trend zone for a few days. The price action is indicating bearish signals.

Ethereum indicator analysis

Ether price has broken the 50-day SMA but finds support above the 21-day SMA. The upward move will resume if the current support holds. The coin is below the 80% range of the daily stochastic. ETH has been in a bearish momentum. This is because it was trading in the overbought region since October 10.


Key Resistance Zones: $220, $240, $260

Key Support Zones: $160, $140, $120

What is the next direction for Ethereum?

From the current price action, it appears the coin will further depreciate if it faces rejection at the recent high. Besides, on October 16 downtrend, the retraced candle body tested the  61.8% Fibonacci retracement level. This indicates that the coin will further depreciate to level 1.618 Fibonacci extension. That is a low of $348.43.


Disclaimer. This analysis and forecast are the personal opinions of the author that are not a recommendation to buy or sell cryptocurrency and should not be viewed as an endorsement by CoinIdol. Readers should do their own research before investing funds. By Coin Idol , 2020-10-17 12:38:00 ,

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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.

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

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