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ETH increased Price Momentum reflected with rising short-term SMA
ETH chart may be showing signing of Trend reversal characterised by –
Asset Price completing its price decline phase(bottoming phase) and enter Trend reversal phase with ETH price building strength to rise gradually.
ETH chart.Short-squeeze induced spike in ETH prices forming bullish SMA dynamics
The Price of ETH at the time of writing is 2,458$.
The recent trending short-squeeze story of Aug 19-21 that drove price of BTC up also drove the price of ETH considerably.
I have evaluated the impact of the short-squeeze on BTC’s increase in prices here –
Evaluating the Impact of the Short Squeeze on BTC’s Price Rise Above $75,000
That short-squeeze episode played out on ETH as well, increasing ETH’s price by 35% from 1886$ to 2,513$ during this period.
Charts show that ETH rose beyond psychological mark of 2000$ - breaking past two resistance points - 1956$ and $2310 to rise to current price of 2,513$ plus.
This has pushed ETH price not only beyond 200 Simple Moving Average (SMA), but also above ETH’s 100 SMA, 50 SMA and 20 SMA.
If ETH price sustains over these moving averages and then further acquires upside momentum – this may be the early stages of ETH’s Trent reversal episode.
Simple Moving Average (SMA) is the average closing price of an asset over a period of days(200,100,50, 20).
In a Chart – the average closing price of the asset’s Price candlestick over a number of days provides SMA.
So, in a bear Market where the trend is the declining price of asset –
The 200 SMA, 100 SMA, 50 SMA, 20 SMA keep falling.
They will be below one another denoting that 50 SMA is below 100 SMA because asset prices are continuously falling.
20 SMA < 50 SMA < 100 SMA < 200 SMA
Simple Moving Average (SMA) is the average closing price of an asset over a period of days(200,100,50, 20).
In a Chart – the average closing price of the asset’s Price candlestick over a number of days provides SMA.
So, in a bear Market where the trend is the declining price of asset –
The 200 SMA, 100 SMA, 50 SMA, 20 SMA keep falling.
They will be below one another denoting that 50 SMA is below 100 SMA because asset prices are continuously falling.
20 SMA < 50 SMA < 100 SMA < 200 SMA
Once the price of the asset increases – its shorter-term SMA begins to respond by rising,
This changing SMA dynamics is visible in ETH Price Chart.
ETH chart.Short-squeeze induced spike in ETH prices forming bullish SMA dynamics
ETH price has risen surpassing - 20 SMA (yellow), 50 SMA (blue), 100 SMA (white) and 200 SMA.
ETH price ~2,458 above -
20 SMA = 2,048.1 🟡
50 SMA = 1,934.0 🔵
100 SMA = 1,871.3 ⚪
200 SMA = 2,010.3 🔴
Since ETH price rise momentum has been sharp and instant – the asset’s price has risen above all major moving averages – very short term 20 MA, short term 50 MA, intermediate term 100 MA and long term 200 SMA.
Besides this – shorter term moving averages have begun to cross over longer-term moving averages and move upwards.
20 SMA has passed above ETH 50 SMA, 100 SMA and 200 SMA.
ETH 50 SMA has surpassed 100 SMA.
So SMA dynamics in ETH is -
20 SMA > 200 SMA > 50 SMA > 100 SMA
As ETH’s price rose – SMA with Shorter time history rose first, while SMA having longer time history rose later as longer term SMA prints ETH SMA over longer time-frame.
In a Bull Market where asset prices continuously rise SMA alignment pattern is –
20 SMA > 50 SMA > 100 SMA > 200 SMA
Should ETH price keep increasing – ETH short-term SMA would continue rising above ETH longer-term SMA.
This would have ETH’s 50 SMA and then 100 SMA cross over ETH’s 200 SMA.
The point where 50 SMA crosses 200 SMA is alluded to as golden cross movement.
When a Golder-cross takes place it means an asset whose price was declining as it underwent a bearish phase has experienced substantial price increases.
This means the momentum has turned bullish as price increases cause shorter term SMAs to move faster and higher as they print price changes of asset over shorter time frame.
Generally at that point – asset’s price trend is considered to have turned bullish as only continuous price increases can cause this dynamics – where 50 SMA has crossed 200 SMA.
The question now is will ETH rising price momentum continue?
This will reveal if ETH has completed its bottoming phase, where the asset has reached its low, and is gathering strength to enter the phase of price rise, causing a Bullish Cross-over Trend reversal phenomenon.
If ETH price manages to sustain above these moving averages, and then increase – the golden cross would confirm the ignited Bullish trend of ETH.
Let’s wait and watch if ETH price momentum passes to enter Bull Phase.
