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At Last, Ethereum’s Local Top?

By:
Dr. Arnout Ter Schure

Yesterday, Ethereum topped only 3.1% above the ideal target zone set forth a month ago. A break below $2140 suggests $1900-1800 is next for a potentially long-term bottom.

Ethereum coin, FX Empire

In this article:

Our Previous Assessment Was Not Entirely Correct, Though Not Too Far Off

Over the last month, we have been anticipating a local top for Ethereum (ETHUS) around ideally $2150-2330, and in our previous update from two weeks ago, see here, we found by using the Elliott Wave Principle (EWP) that Ethereum’s (ETHUSD )

“… our forecast for a local around $2150+/-25 and the anticipated subsequent decline was correct. [But] we still need a daily close below $1910 to confirm this path (a pullback … to ideally around … $1770-1845).”

Fast forward, and ETHUSD did not close below $1910. Instead, Ethereum’s price exceeded the $2136 high we initially labeled as (grey) Wave-i. It then staged another rally, peaking at $2403 yesterday. Although we already showed our premium members that as long as $1910 would hold, a breakout above $2136 could target $2400 (see here) on December 1, our previous assessment was not entirely correct. But, with today’s >7% drop, the largest in one day since the October low, grey W-i most likely completed only 3.1% above the ideal target zone set forth a month ago: still not too far off. See Figure 1 below.

Figure 1. The daily resolution chart of ETH with several technical indicators

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Below $2140 Suggests $1900-1800 Is Next For A Potentially Long-term Bottom

Since corrections are often complex price patterns with lots of dips and rips (A, B, and C-waves), we must see a move below $2140 (blue-dotted horizontal line) to give further confirmation the local top we anticipate is in place. Moving below $2015 (orange-dotted horizontal line) can then allow for a drop- and full confirmation- to the red-dotted horizontal line at $1910. Since ETHUSD reached higher ($2430 vs. $2136), we can also move the grey W-ii ideal target zone to $1900+/-50.

Once attained, Ethereum can launch into its “3rd of a 3rd wave” to new All-Time Highs. In the long term, the cryptocurrency must stay above the June 2022 low ($883), with a severe warning to the Bulls below the October 12 low at $1521, to allow this Bullish path to unfold.

About the Author

Dr. Ter Schure founded Intelligent Investing, LLC where he provides detailed daily updates to individuals and private funds on the US markets, Metals & Miners, USD,and Crypto Currencies

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