Starting off from where we left off on ETH last week (the daily chart above is from last week) we seen the formation of a head and shoulder pattern that failed the break the neckline, implying that a potential push to the upside was possible, however there was much room for price to come down, hence we didn’t advise taking a trade either way on ETH last week (similar to the other pairs, as they are all trading between extremes)
This week, the daily chart looks like this:
We can see that price failed to push further up and rejected down, breaking the neckline this time. currently, we are retesting and falling from that neckline, which suggests we will see a drop in the price of ETH this week.
Lets just back up to the two week chart.
Here we can see that the previous 2 week candle that has just closed failed to break above the 2 week 20 day moving average, and the current 2 week candle is rejecting the same, heading down towards the next relevant support level, the 2 week 9 day Moving Average of $142. A relatively small movement to the downside not really worth trading.
Looking at the 10 day chart we can see that ETH is currently trading inbetween the two Bollinger Band extremes, however with a new 10 day candle due in a couple of days, if price closes towards $142, this will be a 3 bar reversal pattern, combined with a lower 10 day upper Bollinger Band resistance level, leading into a decline on the following 10 day chart.
Zoomed out on the weekly chart we can see that ETH is currently trading inside a big resistance zone, generally above this highlighted box would imply that ETH could well be on the upside movement in the longer run which is unlikely to happen at this time. hence a failure to break above and a continuation to the downside is more likely.
Zooming in on the weekly chart:
We can see that ETH is begging to be curved out by the upper Bollinger Band, as price action becomes denser and denser between the upper Band, and the 9 day Moving Average we’re anticipating a break out of consolidation. Similar to the outlook across the board, one final push up to retest resistance before falling.
When viewed on the daily chart:
We can see this area of consolidation where price action is trading within a triangle – a break below opens up the lower “fake out” trend as a support, inline with our 2 week 9 day Moving Average at $142. Break above the triangle and we could see a fake out to test $175 followed by a sharp decline. Capping price at $175 for a longer term short all the way down to $110, $60 and potentially even $20 before ETH bottoms out.