NOTE: For an update of the ETH analysis, click on the above Tradingview chart image.
Hi trader friends! ETH lower first?
BOTTOM LINE:
Ethereum is likely in the middle of its final leg lower to complete an ABC Elliott Wave double zigzag correction. However, there is the potential of a breakout up at the "area 1 black horizontal line" off recent high, since there are 5 waves off the recent low, but only on lower time-frames.
However, the most likely scenarios is that a larger double zigzag correction lower to either of the previous two Wave 4 reversal areas, at $633 and $590, where the dual dashed green lines are, is most likely at this time.
BUT, IF AN EARLY BREAKOUT UP:
If Ethereum breaks above recent swing high at $746.06, that occurred yesterday, 05/15/18, on this data, then ETH would likely see a larger degree Wave C up, or the structure could be a dynamic Wave 3 of 5 up. But again, the probabilities are that ETH is in a larger Elliott Wave ABC double zigzag correction lower, one that will lead ETH/USD to $633-$590 areas first, then up.
TRADER TIP: GO WITH THE MOST LIKELY PROBABILITY:
After a 5 wave advance, the likely target zone for and ABC correction down, to what I call “The Best Buy -0.11% Zone,” is the prior Wave 4 or the prior Wave 4 of lesser degree, shown herein by the two dashed green lines on this chart (labeled Wave IV and Wave 4). So if we see this market drop to between $633 and $590 on declining momentum and declining volume, that would then likely be a nice-lower risk-area to buy into.
RISK OF A DEEPER DROP BEGINS AT $516:
Breaking below the lower BLUE Andrews Pitchfork support line, currently moving upward yet at $516 where I have labeled the potential Wave C low, would likely lead to a move down to $420, the lowest pitchfork support line (black), or maybe far lower! But that looks less likely right now.
CYCLES:
Longer-term cycle (blue) is still heading lower, but this is on limited sample size of data. So, the blue cycle is less trusted at this time. However, if accurate, a more bearish outlook would be necessary.
The medium-term cycle (green) is strong up (more data=more likely).
The shorter-term cycle (red) is moving down in line with a correction lower for now.
SUMMARY:
This cycle combination best fits a bit deeper correction, for now, then up in the direction of the green cycle, for either a large degree Wave (C) bounce or Wave 3 of 5 up to nearly a new high.
CONFIRMATION EITHER WAY:
The next 3-5 days will likely provide the wave structure and breakdown lower, or breakout higher, which would then likely provide a roadmap for the next 3 months or price movements.
DISCLOSURE:
This analysis is meant for educational purposes only. You trade at your own risk!
Cheers and good trading,
Michael Mansfield CIO
Written at 6:07 PM EST on 05/16/18
Let me know what you think.
Comment Below!