Hi Traders! Ethereum short term forecast update and follow up is here. On September 30th I shared this “Ethereum Short Term Forecast And Technical Analysis” post in our blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club. Spoiler alert – free memberships are available!
On the H1 chart, we have a key support zone that has formed based on the 100%(2726.95) Fibonacci expansion level of the first wave, the 61.8%(2715.28) Fibonacci expansion level of the second wave, and the bottom of the range. The price which was moving lower respected this key support zone and is bouncing higher from this zone. Also, we have a bullish divergence that has formed between the first low that has formed at 2786.63 and the second low that has formed at 2780.33 based on the MACD indicator. Then the price moved higher and broke above the last high at 2946.35 creating higher highs, thus forming a classical setup of bullish divergence followed by bullish convergence. Hence as per the book scenario, after a bullish convergence, we may look for corrections to happen and then further continuation to the upside. Currently, it looks like a correction is happening. Also, the price which is moving higher has broken above the most recent downtrend line which we may consider as another evidence of bullish pressure. So based on all this, my short-term view remains bullish here and I expect the price to move higher further after pullbacks.
Ethereum H1 (1 Hour) Chart Current Scenario
On the H1 chart, based on the above-mentioned analysis my short-term view was bullish here and I was expecting the price to move higher further. After the bullish convergence and the breakout of the most recent downtrend line, the pullback that I was looking for happened, also there were no signs opposing this short term bullish view. The price then moved higher further as I expected it to and delivered a fantastic move to the upside!
On the M15 chart, the market provided us with various facts supporting the bullish view. The H1 chart pullback happened in the form of a range on the M15 chart, the price then moved higher and broke above the top of this range. In addition to this, we had a bullish hidden divergence that had formed between the first low that has formed at 2790.12 and the second low that has formed at 2939.06 based on the MACD indicator. We may consider these as facts provided by the market supporting the bullish view and also there were no signs opposing this bullish view. Then as you can see in the image below how the price moved higher and provided a fantastic move to the upside.
As traders we always have two choices, the first one is to fall in love with our analysis and try to convince the market and expect the price to move in the direction as per our wish. The second one is to follow the facts that the market provides us and make the right actions according to that. As you know the first option won’t help us and as you can see in the example above what happened when we followed the facts that the market hinted us and took the right action according to that.
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