ETH Potential Bullish Trend Reversal
Updated
ETH lightly bounced on 291€ support level which seems holding. The next level of support after this one would be 240€ level, below that it doesn't smell good. The downtrend line ('vertical' blue line) of the correction is strong and haven't been crossed yet. The Long term trend line ('horizontal' blue line) have been crossed but price didn't break support line (291€) combined to the support of the continuity of the upline from the big triangle pattern of previous consolidation (May - November 2017). IF price crosses-right correction downtrend line and crosses-up the Long Term trend line then market will go back into bullish trend and we can see a strong bullish reversal. For that price would need to break the 330€ and 350€ resistance. That would make good buy signals.
At these low levels, the price is interesting for investors, correction has been tough, and no one is speaking about 'bubble' anymore.
That might creates a regain of interest for current and new investors as well as potential big institutional investors (see recent news).
Given the immaturity of market and subjacent new technology of blockchain, I consider this could be the bottom of the correction and the beginning of a new mid-term bull trend. Let's market show what's next.
At these low levels, the price is interesting for investors, correction has been tough, and no one is speaking about 'bubble' anymore.
That might creates a regain of interest for current and new investors as well as potential big institutional investors (see recent news).
Given the immaturity of market and subjacent new technology of blockchain, I consider this could be the bottom of the correction and the beginning of a new mid-term bull trend. Let's market show what's next.
Note
Price crossed-right correction downtrend line and crossed-up the Long Term trend line. It also broke 350€ resistance. As expected this triggered a strong buy momentum. The RSI is still in range (<70) so given this market it is still not considered overbought so we still have place for more up. Given those signals we can consider that the bullish trend reversal is very likely topical. Next target is 394€ resistance. If (when) this breaks, possible up until 630€ resistance. Let's see what's next.Note
<image>tradingview.com/x/fthBwQNs/</image>394€ resistance was quickly and easily broken and holds now as a short-term support. The pattern in formation since 26th of April looks very much like a cup&handle pattern and the upper line of the cup&handle pattern is located at the 434€ level. It seems that this upper line holds well for now as a short-term resistance but If (when) price breakup this upper line, we can expect a strong breakout. The depth of the pattern is 33% which lead us to 578€ level. Consequently we can expect a breakout of the upper line and a raise to those (578€) level. If this happens, the 630€ resistance won't be so far away.
I think we can be optimistic on this as we currently see a regain of interest and confidence in those markets, the uptrend reversal is confirmed.
Finally, given the current situation of global (debt) economy with the report of the IMF saying in its semi-annual fiscal monitor report that the global and public debt has ballooned to 225% of global gross domestic product in 2016, and the not-stopping QE from central banks since the 2008 crisis, we can consider cryptos would be one of the refuge in case of a strong devaluation of fiat currencies (that would likely happen if things get bad, and they will at some point).
Let's market show us what's next.
Note
I'm adding somethings to my precedent update:RSI is still in range : more up possible.
We can see an hidden bullish divergence on the RSI (high-low+higher-low vs low-low+lower-low), which smells good. Same observation on the MACD.
Moreover, the price seems to start to break out the channel ending the cup&handle pattern.
Let's watch!
Note
situation chart : <image>tradingview.com/x/gTLn8fPm/</image>
Price broke-out the cup&handle upper line and as expected we had a strong pump. Price is sticking to the forecast very closely and seems in the good direction to reach 578€ level (transposition of cup&handle depth).
We now have a clear short-term support at 434€ and two short-term trend line supports.
RSI is back in range but very high, more up is possible (10-20%) but if it is the case it will need to breathe a little bit before going even upper.
Let's see.
Trade closed: target reached
<image>tradingview.com/x/6gUs8XoD/</image>Target reached : price reached 578€ target and perfectly suited the forecast.
As expected price went up a little bit more (+11% at the time of writing since last update) and took a little breathe. Justified by a RSI out of range but now not so high (76 at time of writing) so given this market we can even expect a little more up. However a return on short-term support trend line (as indicated by arrow) is likely.
Note
<image>tradingview.com/x/4XDH90Yt/</image>Price magnificently bounced down as expected target level (578€ level) and came test the short-term trend support line and the fib support arc. Those supports held and we can now target the 630€ resistance. The RSI is still in range so this scenario is valid.
Moreover, a recent very good french crypto tax-related news was released today and will probably facilitate this scenario.
Let's see.
Note
As my target was reached and my title is now confirmed (the Trend reversal was confirmed) I am stopping this idea here and continuing my analysis here (or see in "related ideas" below) : (tradingview.com/chart/ETHEUR/5DYH0g4I-ETH-Triangle-Pattern-Bull-or-Bear-Breakout-Target-725/)
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