ETHUSD Perspective And Levels: Waitng For Retrace.
ETHUSD Update: Price action is stuck within the 324 to 334 minor resistance zone. I am still waiting for a retest of the 306 to mid 290s support for an opportunity to buy back in. It is a waiting game.
At the moment price is fluctuating with no progress in either direction. These coins seem to take turns and go in spurts, and in order to attract order flow, this market needs some positive news. The fact that it lost momentum within the current resistance zone is a sign that it has more room for a correction which can lead price into the 306 support area.
I have mentioned it in my previous report, and I will mention it again. In terms of Elliott Wave, corrective waves typically unfold in 3 legs. The third leg, which is Wave C, is often an emotional wave that contains 5 distinct subwaves. Since this market has not made any progress upon revisiting the current resistance, I believe that the subdegree Wave 2 needs to complete a Wave C which can lead price back to the support area that I have been patiently waiting for. If this happens, great. If not, and it goes higher without me, that's okay too because I have nothing at risk.
I do not know when this market is going to break out to the upside. All I know is the bigger picture price structure continues to indicate strength, even in the face of a minor correction. A break of the 338 high will signal the continuation up toward the next resistance which is the 380 area. And since there is a lack of momentum, there is a greater chance of false breakouts which is why I do not buy into these.
The best anyone can do is come up with a number of likely scenarios and prepare for them. I do not prefer to buy breakouts, I prefer pullbacks and I am prepared to miss this move if the market cannot provide an attractive level for me to enter. I am also prepared to buy if the market offers the opportunity that I am looking for at the 306 level or just below. I let the market tell me what to do, I do not impose my own ideas on the market.
Also I get a lot of questions about this so I want to make it clear. I do not place blind buy orders at the support just because my analysis says there is a level at a particular range of prices. IF price reaches my support, then the market has my attention. That is when I look for some form of validation like a reversal pattern to justify a long. This is the process that helps to stack probabilities in my favor. If I just place blind buy orders at the level, my outcome will be random.
Many participants who have a very limited understanding of technical analysis seem to think it is about absolute predictions, or expect precise answers or instructions. The best we can do is uncover clues and align our intent with the intent of the market to achieve a positive outcome. And charts offer tons of clues in order to do this effectively.
If price retraces to my anticipated support area, and I manage to get long, my stop will be placed around the high 280s and my targets will be set around 345 and 370 levels. The reward to risk even without having exact prices is still over 2:! which is acceptable.
In summary, this market is still poised to go higher in the long run, but is hesitant. Current Wave structure points to a higher possibility of a Wave C which can lead price back to the 306 area. IF that scenario unfolds, I will be looking for buy signals. If on the other hand price pushes beyond the 338 level, it can work its way up to the 380 area, but at this rate, I can't justify the risk at these prices. Speculation in any financial market is far from an exact science, and any professional evaluation will provide multiple scenarios because the goal is to be prepared, not to impulsively react. The market will decide, and then we adjust to the new information.
Comments and questions welcome.
At the moment price is fluctuating with no progress in either direction. These coins seem to take turns and go in spurts, and in order to attract order flow, this market needs some positive news. The fact that it lost momentum within the current resistance zone is a sign that it has more room for a correction which can lead price into the 306 support area.
I have mentioned it in my previous report, and I will mention it again. In terms of Elliott Wave, corrective waves typically unfold in 3 legs. The third leg, which is Wave C, is often an emotional wave that contains 5 distinct subwaves. Since this market has not made any progress upon revisiting the current resistance, I believe that the subdegree Wave 2 needs to complete a Wave C which can lead price back to the support area that I have been patiently waiting for. If this happens, great. If not, and it goes higher without me, that's okay too because I have nothing at risk.
I do not know when this market is going to break out to the upside. All I know is the bigger picture price structure continues to indicate strength, even in the face of a minor correction. A break of the 338 high will signal the continuation up toward the next resistance which is the 380 area. And since there is a lack of momentum, there is a greater chance of false breakouts which is why I do not buy into these.
The best anyone can do is come up with a number of likely scenarios and prepare for them. I do not prefer to buy breakouts, I prefer pullbacks and I am prepared to miss this move if the market cannot provide an attractive level for me to enter. I am also prepared to buy if the market offers the opportunity that I am looking for at the 306 level or just below. I let the market tell me what to do, I do not impose my own ideas on the market.
Also I get a lot of questions about this so I want to make it clear. I do not place blind buy orders at the support just because my analysis says there is a level at a particular range of prices. IF price reaches my support, then the market has my attention. That is when I look for some form of validation like a reversal pattern to justify a long. This is the process that helps to stack probabilities in my favor. If I just place blind buy orders at the level, my outcome will be random.
Many participants who have a very limited understanding of technical analysis seem to think it is about absolute predictions, or expect precise answers or instructions. The best we can do is uncover clues and align our intent with the intent of the market to achieve a positive outcome. And charts offer tons of clues in order to do this effectively.
If price retraces to my anticipated support area, and I manage to get long, my stop will be placed around the high 280s and my targets will be set around 345 and 370 levels. The reward to risk even without having exact prices is still over 2:! which is acceptable.
In summary, this market is still poised to go higher in the long run, but is hesitant. Current Wave structure points to a higher possibility of a Wave C which can lead price back to the 306 area. IF that scenario unfolds, I will be looking for buy signals. If on the other hand price pushes beyond the 338 level, it can work its way up to the 380 area, but at this rate, I can't justify the risk at these prices. Speculation in any financial market is far from an exact science, and any professional evaluation will provide multiple scenarios because the goal is to be prepared, not to impulsively react. The market will decide, and then we adjust to the new information.
Comments and questions welcome.
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