Is Ethereum Still on Track for $2100+
Wrapping Up the Smaller 4th and 5th Waves
Ten days ago, see here, our primary expectation based on the Elliott Wave Principle (EWP) was for Ethereum (ETH) to start wrapping up its smaller 3rd, 4th and 5th waves for the rally that started already November last year and that “…, ETH should now be in (blue) nano W-iii of (orange) Micro W-3 of (grey) Minute W-iii of (green) Minor W-1, anticipated [to] rally to the next resistance level at the November 2022 high of $1671 is unfolding.”
Back then, ETH traded as high as $1610, dropped to $1502, and reach $1680 a few days later to complete (blue) waves iii, iv, and v of orange W-3. See Figure 1 below. The cryptocurrency bottomed earlier this week at $1517 and although it can still try for another stab at the $1500 support level, a breakout above $1680 targets the next resistance at $1785-1855 based on simple symmetry (orange arrows) and Fibonacci extensions.
The Bullish Resolution Continues, but $1500 Needs to Hold
Namely, if this week’s low at $1519 holds then orange W-4 can be considered complete and orange W-5 should be underway, subdividing into the five (blue) waves as shown. Due to the continued move higher, we can also continue to ratchet up our primary-expectation-invalidation level. We started at $1074, then $1350, and now $1500 is that price level.
The strength of the recent rally (RSI14 to 86, MACD to 99, and the Money Flow Index at 100, see the technical indicators (TIs) in Figure 1) is quite typical for a 3rd of a 3rd wave and does support the idea ETH will move higher. Besides, the black circles compare the current TIs’ setup with that of the June-August rally, and find several similarities, aligning the EWP count back then and now.
Thus, ETH continues to follow along our anticipated EWP-based path well. As such, the Bulls should still be able to target $1950-2250 with an ideal of $2100+/-100. Once reached, we should expect a more significant pullback. But for now, our primary focus is the low-$2000s, and to reach that, ETH should A) hold the $1500 level, and B) breakout above $1680. That then targets $1785-1855 from where the next short-term pullback (grey W-iv) is expected to materialize.