- Ethereum is rather interesting during the trading session on Tuesday as we continue to see a lot of back and forth choppiness.
- And I think you also have a situation where I find it particularly interesting as the 200 day EMA is offering support. We’ve seen Bitcoin do quite well over the last several weeks.
- And now Ethereum is trying to join that party, if you will. The $2,400 level looks to be a major short-term support level. I think if we break higher, then the $2,800 level gets targeted. It is an area of significant supply.
But now that we’re above the 200-day EMA, the real questions will be asked of sellers. Now, one thing that I would watch if you were trading Ethereum is what happens with Bitcoin. If Bitcoin can clear the $110,000 level, Ethereum should follow and just go straight up. If it cannot, then we may have to consolidate a bit, which isn’t the end of the world. Ethereum has seen a pretty significant rally of about $800 over the last couple of weeks. So, some sideways action here forming a bit of a bullish flag isn’t necessarily the worst result.
If we break down below the $2,200 level, then I think something is a little bit of a problem here. And we will have broken the back of a couple of hammers over the last couple of days.
So, I really don’t like that look at that point. But I think ultimately, we are trying to work off some of the excess buying and we’re just waiting to see if crypto in general takes off. Again, I think the real key to this chart is over on the Bitcoin chart and the 110,000 dollars level.
Potential signal: IF Bitcoin breaks above $110,000, I am buying Ethereum as well. I would have a $400 stop loss, with a potential target of $850 at that point in time, regardless of ETH price.
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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.