ETH/USDT: Direct rise scenario invalidated - What next?
Context: GLOBAL MACRO SITUATION
The current state of global financial markets and cryptocurrencies are worrying millions of investors around the globe as the markets have experienced a sharp drop that started about a week ago. This correction of riskier assets, such as US stocks and cryptocurrencies, have been accelerated after having reached the exhaustion signal of the previous BTC and ETH bull run in November, followed by the SNP 500 trend in December 2021, which are both highly correlated.
The warning sent from the President of the US Federal Bank (Jerome Powell) last October, regarding the risk of an exceptional inflation episode in 2022 as a consequence of the management of the COVID-crisis, is today being reinforced by other exceptional circumstances such as the limited supply of energy, grains and semi-conductors, the geopolitical tension in Europe (Ukraine) and an extension of a strict lock-down in China.
The speech of Jerome Powell two weeks ago and the significant rate hike of 0,5 basis points, gave a strong signal to the market strategists who are now forecasting a longer period of normalisation in order to see the if the US and other developed countries are able to counter the ongoing inflation. The consequence of this situation is the risk of slowed down growth globally in the coming months, something that will lead to a natural reallocation in the financial markets, which in turn will also affect the crypto markets.
Now keep in minds that the. market gets the answer to the question of visibility it was requested and the bear market on going on ETH since the ATH already priced 80% of the negative news which can impact the market. So now it is more probable to see a normalisation in the price action by forming a last drop to finalize the wave structure and the auto-similarity (Bearish breakout potential) before drawing a bottom configuration in order to prepare the next bull run.
Previous Analysis (06/04/2022) - The direct rise expected above 2960 has been stopped and invalidated opening the alternative case potential 1900 (reached) and 1600/1250: https://www.tradingview.com/chart/ETHUSD/2NN8Zrhf-ETH-USDT-Short-term-corrective-pattern-in-progress-before-rise/
Tactical horizon view 3 to 6 weeks
Following key technical element on a daily basis :
(i) the auto-similar target (Blue arrows) reached in end of january has been penetrated calling for new bearish move
(ii) the bearish breakout from the intermediate consolidation last week invalidated the direct rise scenario opening auto-similar move towards 1600
(iii) Moving average (EMA) are now resistance after having crossed to the downside
(iv) RSI indicators broke 40 support and doesn't show divergence - no exhaustion yet in the bearish momentum
(v) Elliot wave count is showing 2230/2530 as key resistance - this resistance area is the maximum bounce potential to drow the minor (iv) wave pattern before developping the last downside leg in wave (v) (c) (4) = End of bear market => target 1600/1250 area.
=> On this horizon (daily chart basis) there is actually absolutly no bullish element.... that why as long as 2530 remains resistance a further downside move is more likely to test 1600 and max 1250, once this last downside leg has been down we are entering in a strong buyback area from the Strategic horizon
Strategic Horizon view 3 to 12 months
=> Above 800 support we are focus on 1250/1600 as key buying area to anticipate a a recovery in order to reach between 50% to 61,8% from the previous highs (for now 2960/3420 area) and then later the 6400 resistance.
Enjoy my friends !
Context: GLOBAL MACRO SITUATION
The current state of global financial markets and cryptocurrencies are worrying millions of investors around the globe as the markets have experienced a sharp drop that started about a week ago. This correction of riskier assets, such as US stocks and cryptocurrencies, have been accelerated after having reached the exhaustion signal of the previous BTC and ETH bull run in November, followed by the SNP 500 trend in December 2021, which are both highly correlated.
The warning sent from the President of the US Federal Bank (Jerome Powell) last October, regarding the risk of an exceptional inflation episode in 2022 as a consequence of the management of the COVID-crisis, is today being reinforced by other exceptional circumstances such as the limited supply of energy, grains and semi-conductors, the geopolitical tension in Europe (Ukraine) and an extension of a strict lock-down in China.
The speech of Jerome Powell two weeks ago and the significant rate hike of 0,5 basis points, gave a strong signal to the market strategists who are now forecasting a longer period of normalisation in order to see the if the US and other developed countries are able to counter the ongoing inflation. The consequence of this situation is the risk of slowed down growth globally in the coming months, something that will lead to a natural reallocation in the financial markets, which in turn will also affect the crypto markets.
Now keep in minds that the. market gets the answer to the question of visibility it was requested and the bear market on going on ETH since the ATH already priced 80% of the negative news which can impact the market. So now it is more probable to see a normalisation in the price action by forming a last drop to finalize the wave structure and the auto-similarity (Bearish breakout potential) before drawing a bottom configuration in order to prepare the next bull run.
Previous Analysis (06/04/2022) - The direct rise expected above 2960 has been stopped and invalidated opening the alternative case potential 1900 (reached) and 1600/1250: https://www.tradingview.com/chart/ETHUSD/2NN8Zrhf-ETH-USDT-Short-term-corrective-pattern-in-progress-before-rise/
Tactical horizon view 3 to 6 weeks
Following key technical element on a daily basis :
(i) the auto-similar target (Blue arrows) reached in end of january has been penetrated calling for new bearish move
(ii) the bearish breakout from the intermediate consolidation last week invalidated the direct rise scenario opening auto-similar move towards 1600
(iii) Moving average (EMA) are now resistance after having crossed to the downside
(iv) RSI indicators broke 40 support and doesn't show divergence - no exhaustion yet in the bearish momentum
(v) Elliot wave count is showing 2230/2530 as key resistance - this resistance area is the maximum bounce potential to drow the minor (iv) wave pattern before developping the last downside leg in wave (v) (c) (4) = End of bear market => target 1600/1250 area.
=> On this horizon (daily chart basis) there is actually absolutly no bullish element.... that why as long as 2530 remains resistance a further downside move is more likely to test 1600 and max 1250, once this last downside leg has been down we are entering in a strong buyback area from the Strategic horizon
Strategic Horizon view 3 to 12 months
=> Above 800 support we are focus on 1250/1600 as key buying area to anticipate a a recovery in order to reach between 50% to 61,8% from the previous highs (for now 2960/3420 area) and then later the 6400 resistance.
Enjoy my friends !
Trade closed: target reached
Target reached
CIO & Head of market research (Automata - Vancelian)
vancelian.com/en
vancelian.com/en
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
CIO & Head of market research (Automata - Vancelian)
vancelian.com/en
vancelian.com/en
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.