The Fed will release its interest rate decision tonight. We then consider an increase in the volume of exchange on the crypto markets. If the key rate follows forecasts, we can predict a potential correction. Let’s try to trade and take advantage of this corrective movement on Ethereum (ETH).
Medium-term view on ether (ETH)
On the Daily chart, we can see relevant reversal signals. First, there is the appearance of a bearish pattern: the bearish beats. It has been forming since November, and is likely to send the price back below $1378. It is also seen that the price was unable to break through the November high (at $1678). This is then a critical obstacle. Additionally, this level aligns with the opening price of The Merge. All these signals lead us to a conclusion that there will be a correction on Ethereum (ETH). Then, the appearance of an RSI Divergence shows the decrease in bullish pressure since the beginning of the year. Thus, taking a short position would be interesting. However, in order to have a more precise entry point, let’s analyze the chart in H1.
More precision on the time scale
We have seen that several bearish signals have shown themselves on the medium term scale (Daily). This is why we will consider selling Ether (ETH). On the hourly chart, let’s try to get away from the technical indicators. The short-term structure of the price is also showing bearish signals.
Sunday’s high ($1700), which is higher than last Thursday’s high ($1638), could be seen as a hold on liquidity. Then the price broke through the weekend low ($1560) during Monday’s session. Which can be seen as a breakout of the bullish ether (ETH) pattern. Additionally, Monday’s high ($1650) remains below Sunday’s high. Thus, we could envisage a week in the red for ether (ETH).
Our entry point sits at $1620. This is the 78.6% Fibonacci level if we measure the range from the London session on Monday. Our stop loss could be placed above the weekend high. Then, the target would be below the opening price for the year.
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