Ethereum - bearish divergence

Price action has returned a massive 4500% since the lows of March 2020. You have 46x your initial investment had you bought in back then.

There’s a huge amount of bullish sentiment calling for $8k, $18k Ethereum - while that may occur in the future, price action right now is looking very bearish. Why?

On the 2-week chart above:

1) A 6-year resistance / support trend line was recently broken to the upside and then quickly rejected. A fake out. This trend line is important, look left. Previous rejections from this trend line resulted in 40% & 70% corrections, respectively.

2) A bearish engulfing candle was printed following the break out. Remember this is a 2-week chart, these time frames are significant.

3) The oscillators: RSI, Stochastic RSI, & MFI are all printing lower highs as price action printed a higher high. This is regular bearish divergence. You can ignore one oscillator but all three printing negative divergence is not to be ignored.

Finally there is the 1-month chart below. Last month a perfect spinning top candle was printed. Neither buyers or sellers have control of the market, classic indecision. These candles are powerful when confirmed. It would make a lot of sense (whichever way you are long or short) to wait for the following monthly candle.

1st target $1800

2nd target $1200

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I should add - a close on the 2-weekly above $4200 voids this idea.

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-20% correction so far. However that might be the end of the road for this short idea if the 21-week EMA (yellow line) holds as shown on the 10-day chart below.

Additionally the MFI just printed continued support, a pleasant surprise. This is what the bulls need.

I'd not be short anymore on this idea until confirmation of support.

Giao dịch đang hoạt động:

1st target almost reached.

Price action approaching the 200-day SMA. Do not automatically expect support, wait until confirmation.

Failure to support $1800 means a one way ticket to $1200.

Giao dịch đang hoạt động:

Going to add a 3rd target $860

The 3-day chart below is looking very bearish indeed. This is a not a reflection on all alt-coins, just Ethereum.

The 21-week EMA (yellow line) has confirmed resistance. There is the nested head and shoulders pattern with a break of the neckline suggesting a target of $860.
I don't understand why so many tradingview ideas are long with popular youtubers calling for $5k - $10k Ethereum - ignore them.

There something else interesting - as mentioned above this is not a reflection on all alt-coins, if I pick something at random... BEL/ETH, what is Bella?? no idea. Have look, oversold against the Ether pair with 'incredible buy' lit up as price action finds support on the 21-day EMA.

Another random pick SNT / ETH - same story as BEL, oversold, 'incredible buy', with support on the 21-day EMA.

Summary? Ethereum looks very bearish in the weeks / months ahead against the dollar and many other alt coins.

Bình luận:

Something else worth adding. Circled in purple on the same 3-day chart are the 12-day EMA crossovers of the 21-week EMA. Look left. Last crossover in March 2020 marked the bottom of the sell off. The previous three crossovers were -50% (August 2019), -88% (March 2018), -40% (November 2016).

Be careful!