Disclaimer
Forecasts of financial markets are the private opinion of their authors. The current analysis is not a guide to trading. ForkLog is not responsible for the results of work that may arise when using trading recommendations from the reviews provided.
Vadim Shovkun, a practicing trader and founder of the Crypto Shaman project, talks about the current situation on the market.
There is minimal volatility in the market for bitcoin, the latest review is relevant. Therefore, let’s consider the situation on the second largest cryptocurrency by capitalization.
The first thing to look at is the strength index in correlation with bitcoin. Ethereum looks a little stronger, the last wave of growth is not absorbed, the overall structure of HLHH is not broken. Ethereum is currently at a distance of 17% to its last wave low (Bitcoin is only 7%).
Data: Trading View.
Now ETH is trading within the main horizontal volume of the previous growth wave (HVN). If Bitcoin fails to consolidate, the coin will go -34% to the next resistance in horizontal volume (compared to -23% for BTC). As part of the rebound on momentum, growth is currently predicted to increase by +22%.
Data: Trading View.
Based on this, we can consider interesting areas for searching for long positions. The $3085-$3140 area is a small support zone, while a stronger zone is in the $2850-$2950 range.
When going into the second zone, most likely, a bullish divergence will form on the RSI + W-shaped formation, which will also be long signs.
Data: TradingView.
In the event of a failure under the $2850-$2950 area with consolidation, Ethereum will have serious problems – the downside margin is quite large. But such a development of the situation is possible only if bitcoin fixes below $40,000, which will indicate a reversal of the medium-term trend and the beginning of a crypto winter.