ETHUSD update: As BTC makes history breaking 10K, this market is consolidating, it is just a matter of time before this makes the run for 500 based on the current price structure. So I am now long at 468.72. Stop 454. Target 499. RR: 2 to 1 (50% position size).
These markets are great because they do not seriously correct anymore ( hehe, YET). When they do, it is most likely going to be extreme, and many will jump in too early and get caught. I do not plan to be part of that mess.
Until that happens, we can either play close to the vest and be quick to get out if the market happens to turn and be prepared for a small loss, or just avoid these markets completely. Investing for the long term at these levels is a very risky proposition.
With that being said, it appears that there is not much of a relationship between these markets except for which ones investors pile into next. They take turns. And the whole idea of short term trading is to capitalize on these movements while keeping risk under control.
While BTC is in the spot light, this market has been ranging between 446 and 491. The mid 450s have also been a supportive area as well. Consolidations like this are trend continuation patterns and there is no question the trend is bullish. Some may wonder, isn't this going long near the top? No. This is a consolidation that is within a clear bullish trend, and offers clear reward/risk. If the entire market falls apart while I am long, well, that is the risk that I take, but that is why I have a stop at 454.
This trade is aggressive in the sense that this market is not at a projected support, but there is a triple bottom reversal formation on a 1 hour chart off the 458 level. The trade set up isn't perfect, but the context is clear, so I adjust by taking a smaller position. I am not changing my plan, I am just being more flexible and believe the environment is supportive enough for the moment. I also believe that 14 points of risk, defined by a clear structure is reasonable for these conditions and within the rules of MY plan. I will do my best to update this position as it unfolds, BUT keep in mind I do not watch these markets tick by tick.
In summary, there is no precision in trading. It is a matter of having a plan and a set of guidelines that govern every decision while allowing for some flexibility. In taking a long at 468.72, I am buying in the middle of a range that is within a clear bullish context. To adjust for this aggressive play, I am entering with a smaller position (50% of usual size). I can always add the other half on a break out attempt. Consolidations such as this are continuation patterns, and I believe will follow through until the entire coin space corrects, and it will. BTC over 10K, ETC over 30? And some of the less popular coins all pushing steep new highs is a sign of a bubble in my book. It's okay to participate as long as you understand WHERE your risks are, and what to do when the carpet gets pulled. I am willing to take a chance on this market, within the conditions relevant to this the current environment. It is a short term play, anticipating an attempt to the psychological 500 level.
interesting idea on ETHUSD... let's see if it works. I hope it does..!
lzstva
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thank you for the great analysis
MichelRozpendowski
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LOL, yes Marc nailed it again to be stopped: 3rd time since October I think.
Fortunately, as advised by Marc, these are just his thoughts for his plan, so I am reading his analysis that is very interesting, but I am also following my plan, that was clearly not to be in, yet, and I am glad to have followed my plan.
I am looking forward to next Marc's post as the market became more interesting last night with the correction.
Cheers!
cusx
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Amazing job Marc ! Love it.
JamesOliver
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Well done...where is the end game on this run?
monkia
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Great call Marc
Mrbill862
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nice call, on the money
mk_trader
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@MarcPMarkets I have seen reversal clues, but am little late to the show. Will wait for 0.382 retracement to get in if situation proves to be good. There is some debt that ETH has towards me ;-)
MCrypto
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@MarcPMarkets Wow, that was a spot on! I keep following your analysis since last august and it really taught me a lot. Do you think it will continue the run after 500 directly? or it will go for a retrace first?