ETH IMMEDIATE Short Sale: Fibs, Fan, Trends, and Resistance
Updated
What's up Guys and Gals, this is a short sale idea for Ethereum based on 3 prior sharp sell-offs over the last few months. The idea for this trade is based on the market meeting resistance at the 38.2% Fibonacci level (the entry on our potential short trade), and re-testing the 61.8% Fibonacci level (which is our profit target AND potential entry into a long trade). The time-frame to be in this short trade is roughly two to three WEEKS. This is about how long each prior sell-off in the last 3 months took to make their runs, with plenty of opportunities to get out in between. The risk-reward profile on this trade varies depending on where you place your stop, but the example I've provided is a good middle-of-the-road stop (a reasonable 18% loss limit) with an attractive R:R of 1:2. As long as you keep your loss limit under 30%, giving your trade some additional room to breathe is not a bad idea. The benefit of this is insulating your position against the potential effects of breaking news events, while the disadvantage is more risk. Approximated trendlines and the top of the downward channel roughly coincide with the 61.8% level, which, to me, adds to the support strength of the price level there as a buying opportunity. With the Gann Fan, price should theoretically fall faster once it retraces past the 3/1 line. The 3 represents units of movement vertically (price) over the 1 unit of movement horizontally (time), which I also see as added confirmation for this trade idea. If you are just not comfortable selling ETH, I would recommend that you wait for price to come down into the 61.8% level to enter into a long position. Don't forget to check out my long-term Elliott Wave long trade idea for bitcoin as well, you won't want to miss it! I'll post an update if North Korea immediately sends price flying and wrecks this trade. Happy Hunting Everyone.
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I wanted to post an update as this idea progresses. Since posting this idea, price has waffled around the key Fibonacci level that was identified as the entry point, if anyone out there took this trade, you're now in the money by 8-10%, something like that. We could see accelerating sell-offs here in the next few days, so consider yourself warned. If price comes down to the .05 region, taking profits on the short sale and opening a long position is recommended. Deeper sell-offs are entirely possible but the upside is considerable at that level. Happy Hunting Everyone.Note
Quick 2nd Update: The sell-off continues, as expected. Meanwhile, Bitcoin price surges forward and all hell is going to break loose. As bitcoin skyrockets, individuals and algorithms wanting to capture those gains, I believe, will sell off their Ethereum to buy BTC, it's reactionary, FOMO, but it has a double whammy effect. The best way to play Ethereum is to wait for the deepest, nastiest sell-offs and catch the bounce the other way. And for G*d's sake hold onto your btc. My theory is that as the total digital market cap continues to forge into the darkness of uncharted price territory, bitcoin dominance in the total digital market will SHOOT back up. I'm going to have a smoke and watch the fireworks when btc reaches 5k.Note
Still waiting for ETH to truly fall flat on its face, it's naturally to be expected, and it will pick itself up like nothing happened. If you took this trade youre making good money, take some profits to insulate your position and hold the rest for the big flop. this might be an opportunity for a quick countertrend buy and resale, or sell (w/ optional buy) and re-entry into the short off the bounce. Hopefully this gives you guys some ideas on different levels of risk that you can take in this trade. Good luck, stick to your guns.Note
Here might be a place to look at buying to cover if youre still wide open on this without profits. Should have lopped chunks already but it doesnt matter, watch for signs and be ready to pull out if things start to go against you in this trade. Can always try again but the market has bounced hard (sweet counter-trend trade). and is still quite active right now. A strategy for the more advanced might be to open square, but you need to take your profits when you know it will swing and this is not for beginners. I still think the short trade potential is huge but the market is experiencing a shakeout of weak and marginable hands, which are essentially reorganizations of bad investments. Keep Hunting Everyone. P.S. who's ready for Gold to blow, post in the comments below!
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I still think there are more shorts coming guys, looking for .04 and accelerating, brutal sell offs as these sales get picked up by bigger money. You do not want to end up underwater holding ETH for 2 years, believe that. Keep Hunting Everyone.Note
I want to discuss theoretical ways in which you might short a cryptocurrency or digital asset. Really the only way that I know of is shorting on margin, which is inadvisable, and maybe a few options contracts, but I do not consider these to be real solutions. Shorting a cryptocurrency or digital asset necessarily involves cash. What I mean by cash is actually changing vehicles, ideally into a more liquid and stable form. Things become more complex if you divest into bitcoin, because there's still a naturally high degree of risk of quick price change. My recommendation would be to cash out into dollars or whatever your personal fiat currency is, immediately, especially if you're up on the original price of bitcoin as well as the cryptocurrency (here, ETH). The reason I recommend that is that btc could get clobbered, like was just seen, but my advice is to hold out any storm if you can, and if you're in a long btc trend it can give your returns a nice boost. If you're holding fiat cash, then you can buy in on btc again when it springs a bloodbath, which is what you really want. Stay Frosty Hunters.Note
The sell-offs continue, my opinion is that there will maybe, possibly, be a few small bounces to the upside, but they are not worth it. Go for the big trade, not the small trade. Go for the long-term, not the short-term. The sell-off will continue, it will accelerate, it will be ugly, if you're holding bags of ETH you're going to be mighty sorry. Expect similar from LTC. The bigger the market cap, the harder they fall ;) Keep Hunting, My Lovelies, and do not despair. In danger there is opportunity.Note
And right on time, the sell-offs continue, if you're holding ETH this whole time you are probably underwater, but do not worry, do not FOMO, just wait it out and let it be a lesson to you! I'm looking at .036 and .02 as potential bounce/buy points, the market has to go the other way, it's just a matter of time, and we are getting closer to that time, but right now the selling power is still very strong, very formidable, be cautious if you buy here, buy small. My recommendation is to WAIT and WATCH for price to go a bit lower before stockpiling again. .036, .02, and anything below that is a golden buying opportunity, if price comes lower than that it's buy, buy, buy.Trade active
Hunters and Huntresses, I told you it would come way down, it came way down, if you listened to me and got into cash on ETH then you did it right. I told you it would hit .036, it bounced and then broke support to the downside. IF I wanted to buy it then this would be my first, meaning my conservative buy target, but I think that price may come a bit lower, that will be the second buy target, the greedy one. This is for a holding strategy, look what can happen in a few months when you be patient. It dropped almost 2/3rds of it's price. If you were holding you lost bigtime. Keep Hunting.Note
It is time indeed, time to think about buying again if you're a believer in Ethereum. Look at the volume! Look at how I called this play! Go with your gut, not your emotion, your gut; your intuition. And Keep Hunting!
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