Direct from the desk of Dane Williams,
exclusive to leofinance.io
Key Takeaways:
- Ethereum rips through resistance to fresh highs.
- Market remains in an extremely strong, bullish trend on the daily and above.
- As a result, our bias remains to only trade from the long side.
Ethereum Technical Analysis
One of my favourite sayings when it comes to support/resistance trading, is that 'resistance is resistance, until it's not'.
Well, a perfect real world example of this saying has been playing out on Ethereum and is worth taking a look at on the blog today.
The last time we spoke about ETH/USD, you may remember we had Ethereum struggling to print fresh highs as price just couldn't seem to break through the daily resistance zone at the $2,000 psychological level.
As long as price was being capped by resistance, our bias was to day trade Ethereum from the short side using the resistance is resistance until it's not concept.
But as you'll see on the following daily chart, price soon made light work of the zone, blasting straight through as the bulls took control.
ETH/USD Daily:
With resistance no longer resistance, our bias flips to only wanting to trade the pair from the long side.
Let's zoom into the Ethereum hourly chart and take a look at the intraday price action to better explain why.
ETH/USD Hourly:
You can see that price ripped through resistance on the 10th.
It was here that with price now above our daily zone, our bias flipped to only wanting to trade from the long side.
Our strategy says to mark the last place of short term resistance (last red candle) that when retested as support, could be used as an entry.
Unfortunately, you can see that while price did pull back on the 11th, it missed our entry zone by barely a few pips.
As a result, I missed getting long before this move.
But for purposes of the blog, I've marked a potential second area of short term resistance that could have been used as an entry just a little higher.
It's a little bit messier, but the concept is exactly the same and worth noting.
Best of probabilities to you.
Data to Watch:
- Not applicable on decentralised cryptocurrency markets.
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This daily market analysis blog is exclusive to leofinance.io.