ETHBTC bear market wave count is full. Market reversal imminent?

Updated

Ethereum has been lagging the growth of bitcoin by some margin all year. The ratio of its price to bitcoin has been on decline.

Long-term tracking of the Elliott Wave count of the ETHBTC market now indicates that this bear market cycle for the pair is over, as we can fully account for completed waves, while simultaneously hitting the long-term support trend line.

Therefore I am forecasting that we are about to see a trend reversal for the pair, so that Ethereum may rally faster than bitcoin into the new year.

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For an overview of the entire history of the ETHBTC market I refer to this weekly bar chart.

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At the bottom of the chart is clearly visible the major trend line that has supported the market since inceptions. It is now being approached or touch for the fifth time.

Currently this presents the projected end of a second wave, with the reversal produced by the emergence of wave three, which could propel this market to new highs.

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We are now almost four days into the proposed new bull market for this currency pair and trading has apparently established a well defined ascending channel. It features a support trend line that was just touched for the third time, being well respected with an immediate bounce off the line, in a descent for the finish of a minor second wave.

Several wave sequences are open for filling in third waves, which we might expect to take prices to the top of the channel, as indicated.

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PS: my future wave labels are a bit scattered in this chart. Apologies.

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More detailed view of trading the last few hours, 5 minute scale.
It shows the precision of the trend line bounce.

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Well, trend lines are there to be broken, good or bad is just a view point depending on the side of the market you’re on. The sideways trading at the bottom of the channel wandered off below the line, without much bias, up or down. That’s what happens when two competing currencies, here ETH and BTC, both have no direction.

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The sideways trading has redefined the trend lines and given us a new channel for this pair.

Since then, a strong advance of the Ethereum market in the last day or so, while bitcoin has been lagging, has caused the ETHBTC pair to continue bouncing off its low just below 0.50. It has made a nice advance by over 10% to a little over 0.55 so far.

It has not yet broken out of the downward channel however, so caution is advised. We do expect bitcoin to advance too, which will dampen this pair by virtue of its definition

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The market filled our outline of the fourth and fifth waves precisely, eith the end points of the third and fifth waves falling onto the trend line at the top of the channel.

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On the larger scale, the chart shows that the downtrend regression channel has been broken to the upside.

Since we counted this as a completed 1-2-3-4-5 impulse sequence, it completes wave one of one larger degree. We should expect consolidation or correction in wave two. A typical retrace may be 50% or even 61.8%, or essentially into the middle of the channel.

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The leg down indeed touched the 0.5 Fibonacci retracement level today. By now the channel support has risen so much that the bottom trend line is very close. It might just reach down in another push to touch that too. The 0.618 level is actually below the trend line now, but could be a target still.

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However, looking in detail at the ending push, it looks like it’s done descending. It was just a wick even on the one-minute scale. The wave count seems complex for this leg in detail, but over all it looks like a zigzag, ABC or WXY.

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The second wave did in fact reach the 0.618 Fibonacci mark precisely in its retrace. Swiftly the pair turn northward again. So we should expect better performance from ETH over BTC if those USD markets go up, or vice versa should they decline.

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The ETH traders have fallen asleep at the wheel, and let BTC run away on the first day of the year, with a new 52-week high.
That crushed the ETHBTC chart. Well, only my wave count for the wave 2 low.

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The continued strengthening of dominance of BTC in the crypto space has crushed the ETHBTC market to a point where the pair has broken down below its long-time trend line for the first time.
That closes this chapter until ETH traders wake up from their bear sleep and spend some moneeeeh, or bitcoins.

unbeldi

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