I wanted to briefly show the pattern on the . It also shows up well on the 4 hour chart, but the daily is best to visualize everything. A is not just a random drawing some guy came up with decades ago. It's an important chart pattern which relies on a confluence of fib lines coming together. To put it simply, think of MULTIPLE supports and resistances coming together into a few important points. The pattern is not valid and should not be traded until point "D", also known as the "PRZ" or potential reversal zone.
Since we can see price action his point "D", we can now set up targets. Target 1 is the 0.382 fib line of the AD Retracement. Target 2 is the 0.618 of the AD Retracement. Now we can see that Target 1 has been reached... but the action might not be over yet!
What a lot of traders who are confident in these patterns like to do is once Target 1 is reached, they will set their stop-loss just below target 1(so ~850s in this case), and aim for Target 2. Many times once Target 1 is hit, it will act as a new support for the path up to 2.
Let's watch and see!
-Pink(50 EMA) crossing Blue(200 EMA) = GOOD!
-RSI ABOVE black trend line drawn on the the RSI indicator= good!
-ADX still above 25= trend is still going. good.
-IF RSI drops below trend line"danger zone" this makes a reversal more likely. I will come back and analyze if this happens.
Until then, stay healthy peoples and sleep tight. I think ETH still may have one or two corrections to go through before it reaches Target 2.
That being said, I am writing this update to let everyone know that although we dipped "below" the RSI trend line mentioned in the last update, we are still OK because we are well above the chart line(see below).
In general, ETHUSDT is still in an uptrend. We slowed down, yes, but the bulls have not let the price go much below the 890s... Which as I said previously, I EXPECT to serve as a decent support, because it was the previous target!
The chart right now is showing consolidation, and there's a good possibility the buyers are getting ready for there next big move. Again, IF price dips BELOW 890s definitively, I will update ASAP and we will look at our next moves. Until then, hold on and assume most likely scenario is up.
Stay healthy. Take care of yourselves <3
Here is the REAL chart I was referring to for ETHUSDT:
Now may be a good time to give up on the butterfly, as 1 target was all it could achieve for now. I'm a realist so changing indicators/price action demands for a change of plan. I will check in the morning, if price dipped below 850s(which has been serving as very short term support), I will close the trade.
Best of luck!
Here's the 4 hr chart to show the break of the trend and the negative indicators: