ETH → Ethereum Triple Top Calling for Short Trade? Let's Answer.
ETH's price action has been caught in a trading range since its bull run to $2,400 on December 9th. We've now registered three failed attempts to break that $2,400 resistance, is it time to short?
How do we trade this? 🤔
We can justify a small position short scalp with the current analysis at a 1:1 Risk/Reward Ratio. The justification is the triple top after three pushes up in a bull trend, two strong sell-offs since the $2,400, and the lack of bull momentum at the Daily 30EMA.
This position still carries a fair level of risk, so I would not use your maximum position size based on the initial risk. Rather, as more price action unfolds and provides us with more justification for bearish bias, we can add to our trade with additional entries.
💡 Trade Idea 💡
Short Entry: $2,225
🟥 Stop Loss: $2,510
✅ Take Profit: $1,940
⚖️ Risk/Reward Ratio: 1:1
🔑 Key Takeaways 🔑
1. Three Pushes up from Breakout.
2. Three Sell bars after Push #3, Potential Triple Top.
3. Reasonable Short to Daily 200EMA.
4. RSI at 50.00 and below Moving Average, Indecision.
5. Watch Bitcoins Response to Current Price Area.
💰 Trading Tip 💰
The RSI on its own is a weak indicator and should not be used to make trade decisions. However, when coupled with proper price action analysis, it can help orient the current state of the market and supplement your chart bias.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
Like 👍 and comment if you found this analysis useful!
How do we trade this? 🤔
We can justify a small position short scalp with the current analysis at a 1:1 Risk/Reward Ratio. The justification is the triple top after three pushes up in a bull trend, two strong sell-offs since the $2,400, and the lack of bull momentum at the Daily 30EMA.
This position still carries a fair level of risk, so I would not use your maximum position size based on the initial risk. Rather, as more price action unfolds and provides us with more justification for bearish bias, we can add to our trade with additional entries.
💡 Trade Idea 💡
Short Entry: $2,225
🟥 Stop Loss: $2,510
✅ Take Profit: $1,940
⚖️ Risk/Reward Ratio: 1:1
🔑 Key Takeaways 🔑
1. Three Pushes up from Breakout.
2. Three Sell bars after Push #3, Potential Triple Top.
3. Reasonable Short to Daily 200EMA.
4. RSI at 50.00 and below Moving Average, Indecision.
5. Watch Bitcoins Response to Current Price Area.
💰 Trading Tip 💰
The RSI on its own is a weak indicator and should not be used to make trade decisions. However, when coupled with proper price action analysis, it can help orient the current state of the market and supplement your chart bias.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
Like 👍 and comment if you found this analysis useful!
-Joe Dean
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Trader Engineering Course
**Available Now at TraderEngineering.com**
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