Ethereum's Story Does not end well for the Bulls.
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TLDR: ETHUSD Bearish on all levels. Simple support and resistance and SMAs on the main chart, Ichimoku, OBV EMAs and MFI on our second chart deeper in for those interested. If you want more doom and gloom see the linked BTCUSD chart. IF you want something bullish see my linked silver and gold posts.
Two moving averages of interest are shown using the CM_Ultimate, which is a neat programmable moving average. I have the 80w SMA acting as the 20 month SMA and the 20w SMA. We have clearly met the 20 month SMA as resistance at the blue hammer just as the 20w SMA acted as resistance at the purple hammer. These moving averages put us in a technically bearish situation.
Two major trendlines help understand a lot of ETHUSD price action. Our top bold line on the log chart shows a line with a lot of history acting as support and resistance and while it itsn't in play I am using it for target setting. Our secondary thinner line is still in play. The height of the two blue lines at the blue arrows are the same arithmetically, they just appear to be different sizes due to the log chart. Just a quick glance at the VPVR shows if we have a break out here we drop to where the price action tested and consolidated our primary trend line in early 2017. Whether that would be our bottom of the bear market from this bull trap remains to be seen. The fact we are leaning hard against long term support under the long term moving averages puts us in a technically bearish situation
The chart below has two circles on the OBV. The first of course already happened and shows the predictive power of a OBV 10 (red) - 20 (blue) EMA cross. Should the 10 pass through the 20 again should expect a spill similar to the one we saw at the first circle. The price action shows we have set a lower high on price but the OBV and the 10 EMA is setting a higher high. This is hidden bearish divergence, and it doesn't matter if your indicator is bound or unbound, divergence is a sign of overexertion. In this case, the buyers are over-extended.
Likewise the Money Flow Index shows the power of crosses of the 15 and 50 lookback periods. The red circles being bearish crosses and the green a bullish cross. The purple line show a technical double top and so I expect another bearish cross due within a few weeks.
The double Ichimoku cloud once again shows its power, with any one cloud, the classic equities setting or the longer crypto settings not giving traders the whole picture. The purple arrow showing where the top occurs shows the price action wicked right at the crypto cloud. Normal equities settings traders would not know why the price action failed were it did and crypto cloud traders won't know exactly why the price action will appear to fall off the table when it slips out of the equity cloud support.. Only the crypto settings T-K are being shown to reduce noise and I expect a bearish T-K cross shortly as well.
My target of $40 for ETHUSD is provisionally my final target My target of 1200-1400 of BTCUSD (see my Bitcoin Gold Post) has BTCUSD returning to the price level of the last BTCUSD consolidation patter, which concluded first quarter of 2017. ETHUSD wasn't quite consolidation in the same way at $40 so I would not be surprised to see over-performance and a shot at getting closer to the POC on the VPVR.
Two moving averages of interest are shown using the CM_Ultimate, which is a neat programmable moving average. I have the 80w SMA acting as the 20 month SMA and the 20w SMA. We have clearly met the 20 month SMA as resistance at the blue hammer just as the 20w SMA acted as resistance at the purple hammer. These moving averages put us in a technically bearish situation.
Two major trendlines help understand a lot of ETHUSD price action. Our top bold line on the log chart shows a line with a lot of history acting as support and resistance and while it itsn't in play I am using it for target setting. Our secondary thinner line is still in play. The height of the two blue lines at the blue arrows are the same arithmetically, they just appear to be different sizes due to the log chart. Just a quick glance at the VPVR shows if we have a break out here we drop to where the price action tested and consolidated our primary trend line in early 2017. Whether that would be our bottom of the bear market from this bull trap remains to be seen. The fact we are leaning hard against long term support under the long term moving averages puts us in a technically bearish situation
The chart below has two circles on the OBV. The first of course already happened and shows the predictive power of a OBV 10 (red) - 20 (blue) EMA cross. Should the 10 pass through the 20 again should expect a spill similar to the one we saw at the first circle. The price action shows we have set a lower high on price but the OBV and the 10 EMA is setting a higher high. This is hidden bearish divergence, and it doesn't matter if your indicator is bound or unbound, divergence is a sign of overexertion. In this case, the buyers are over-extended.
Likewise the Money Flow Index shows the power of crosses of the 15 and 50 lookback periods. The red circles being bearish crosses and the green a bullish cross. The purple line show a technical double top and so I expect another bearish cross due within a few weeks.
The double Ichimoku cloud once again shows its power, with any one cloud, the classic equities setting or the longer crypto settings not giving traders the whole picture. The purple arrow showing where the top occurs shows the price action wicked right at the crypto cloud. Normal equities settings traders would not know why the price action failed were it did and crypto cloud traders won't know exactly why the price action will appear to fall off the table when it slips out of the equity cloud support.. Only the crypto settings T-K are being shown to reduce noise and I expect a bearish T-K cross shortly as well.
My target of $40 for ETHUSD is provisionally my final target My target of 1200-1400 of BTCUSD (see my Bitcoin Gold Post) has BTCUSD returning to the price level of the last BTCUSD consolidation patter, which concluded first quarter of 2017. ETHUSD wasn't quite consolidation in the same way at $40 so I would not be surprised to see over-performance and a shot at getting closer to the POC on the VPVR.
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Head and shoulders usually are not continuation patterns but lets see if this head and shoulders is the one to shock the world. It predicts a $30+ drop which gets us well on our way to target.
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The head and shoulders above performed to target and as we zoom out we see a potential correction back to the upside based on this falling wedge. Bulkowski's doesn't consider these a strong pattern "The falling wedge is a very poor performer as far as bullish chart patterns go. The break even failure rate is high and the average rise is low. The only variation that works well is a downward breakout in a bear market." thepatternsite.com/fallwedge.html. Long term patterns like the falling wedge a lot of us charters were using, like my BARR and falling wedge posts, are examples of falling wedges that should perform well. This falling wedge, not so much.
I don't think this wedge will double top so I am using the second method of target setting and using stops to protect my short. The height of A to B would be the full target from break out, but these wedges average about 62% to target. On the upside I look to have a stop loss to protect my gains and prevent excessive time under trade and I have a target to the downside where I am going to consider taking partial profits short of my full target. If we break to the upside I short in the yellow target box.
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