ETHUSD Update: There is a double bottom off of the 279 support and a 5 wave triangle completion. Based on this structure, I believe we are in the beginning of the larger degree Wave 5 that can take this to at least the 350 area over the next week.
In my previous report, I posted an update about an hour ago with my trade entry at 294.76. I immediately received a PM asking me why I changed my mind so fast. When things line up, I adjust, and to compensate for the additional risk I took a smaller position (50% of usual size). My stop is at 276 and my target is 340. Risking 18 pts to make 46. That's more than 2:1.
Posting trades on this platform in a timely fashion is very difficult for me, especially since trade setups do not always appear around the time that I can write a report or update a previous report.
I have been waiting for the retest of the 263 support, but the market has firmed up sooner. The 279 double bottom is very significant and the initial push off that level is a bullish sign. The best entry price was in the mid 280s. I have been highlighting the 279 support level for while now (see previous reports).
The other major signal for me is the fact that 5 corrective waves can be counted within the Wave 4 triangle. Typically when you can count 5 waves in these formations, they are more likely to break out and coupled with the double bottom is very compelling. Wave 5's are the most predictable wave in my opinion because they require 4 previous wave structures in place, which takes a lot of time and effort for the market to build.
The next levels that will signal this Wave 5 is likely to continue toward the 350 area would be breaks of the 306 and 320 resistances. My target is at 340 because it is just under the 350 to 380 resistance zone which would be a convenient area for this wave to complete.
The BTC relationship has been causing concern and why I have been hesitant to enter this market until now, but there is something we must realize: the relationships between these markets is not fixed. Meaning just because BTC goes up 400 points, ETH must go up a fixed % of that. I wrote about the relative strength because I am always trying to detect it and use it as a guide. If it is there, great, but if the BTC lead/altcoin follow relationship lessens, I'm not going to spend a lot of time figuring out why. As long as my market has signals and presents attractive reward to risk according to the criteria of my plan, I will take positions. I'm flexible.
In summary, this market is showing technical signs that a Wave 5 up is in progress and I am willing to participate with a lower risk position. The double bottom off of the 279 key support and the Wave 4 completion are adequate signs. I'm curious to see if any additional profit taking in BTC or some of the other "bubble" alt coins contribute to a new high in this market.
After this run to $350 do you think there is a double top reversal pattern taking place?
rockmancuso
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Your pick for wave 4 is looking spot on...great analysis. Thanks!!
MarcPMarkets
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@rockmancuso, you're welcome. Elliott Wave is a very practical frame work.
MajdDwehji
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Hey @MarcPMarkets , This looks like the beginning of a head and shoulders, if it doesnt surpass 315 today i doubt it will tomorrow as tomorrow is sell-off day. what are your thoughts?
MarcPMarkets
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@MajdDwehji, I answered your question in my most recent report. Yes it does need to push the 315 resistance to really get things going. As far as "sell off day", there is no evidence that supports a sell off day. I do not operate with any biases or preconceived notions like that. If the market chooses to sell off, it will provide signs. Right now, all major supports are still intact. Read the part in my recent report about context.
BrunoDanteSampaio
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@MarcPMarkets, I hope this is not a very stupid question, but may I ask what are whose green and yellow balls in your chart?
FernandoMocer
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@BrunoDanteSampaio, they are entrys for selling on yellow or buying in green
@BrunoDanteSampaio, no such thing as a stupid question. Actually they are points where I posted previous evaluations. The yellow mean the analysis is neutral and the green means the analysis relates to longs. They are not buy and sell signals. If you put your mouse on it, you will be able to read the evaluation posted at that time.
MarcPMarkets
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@FernandoMocer, nope. Those are just links to previous reports. The yellow means I wrote a report that is neutral or more cautious while green means I wrote something that supports the long side of the market. They are not buy/sell signals.