Since Bitcoin is doing exactly what we predicted in our TA published on November 25th, this time, we bring you an extensive Ethereum chart analysis. Lately, traders find the most liquidity on derivatives trading platforms. Therefore, let’s take a peek at what ETH looks like in the ETH/USD BitMEX 1-hour perpetual chart.
The rising wedge
The first thing that we have to acknowledge is the obvious rising wedge formation. The formation usually announces the bearish reversal. Therefore, Ethereum broke downwards from the wedge on November 30th at $154.
Naturally, the price declined to the current value of $147 per coin, which is 6.36% from the latest peak. Usually, when trading in the aftermath of the rising wedge, traders have a short target at the price span below the breakout point with a spread equal to that of the wedge’s base. That means that we should be looking at the $135 level. Since a picture is worth 1,000 words, let’s make things simpler by showing you the chart.
Targeting $135 means that traders predict another 8% decline for Ethereum. While that may seem a bit over the top to ETH enthusiasts, the next important formation in our Ethereum chart analysis will reveal how probable that may be.
The declining triangle in the Ethereum chart analysis
In order to better depict the ongoing situation, we shall use the first chart in the article with the additional formation marking.
In a much shorter timeframe than it was the case with the wedge, but still visible, Ethereum is approaching the closing phase of the declining triangle. Such a formation is completely bearish. Therefore, traders can expect further sell-off during the next few days. Currently, ETH bounced off the lower high and is targeting the $147 support level.
Support and resistance levels analysis
As always, the chart analysis would mean nothing without pointing out some crucial levels. The ETH/USD 1-hour chart reveals that, besides the triangle’s peak, bulls were able to push the price only up to the $150, which is also the historical resistance since late November. On the other hand, the mentioned $147 support may prove to be solid one more time towards the triangle’s closure.
There is another interesting thing visible on the chart. The mentioned $150 resistance coincides with the upper Bollinger bands’ extreme value. In the meantime, the median value overlaps with the lower highs, which could continue if the price dips towards the support. Trading between Bollinger Bands’ values is common for day traders. This time, it can also give a good idea of what may happen in the close future.
Ethereum chart analysis reveals indecisiveness
It is common that towards the end of the triangle formations we start seeing traders’ indecision. Such is the case with Ethereum during the last couple of days. Both MACD and RSI indicators fluctuate around the neutral level. However, since we are talking about the bearish declining triangle, that fluctuation is happening a bit below the total neutrality. The yellow marker on MACD and the blue horizontal line on the RSI perfectly describe what we are trying to explain.
Unfortunately for HODLers, ETH looks really short-term bearish at the moment. Thus, shorting with leverage on derivatives trading platform is a viable option for the next few days or even a week. If Ethereum hits the $135 target, that is the time to look for trend reversal indicators such as RSI divergences, gold crosses, etc. Better yet, try visiting CoinSyncom regularly as we will surely update you on the Ethereum price movement.
You should look elsewhere for investment advice since this isn’t it. Even if it looks like it, it’s not. Cryptocurrencies are known to be extremely volatile and risky speculations. Always do your own research. Consider consulting an investment professional prior to investing your money.