Trade Recommendation: Ethereum
Our February 3, 2019 Ethereum trade recommendation hit both targets. The first one was hit on February 17 when the market rallied to as high as $139.50. The second target was reached on February 24 when Ethereum climbed to $170. Those who followed the trade recommendation grew their investments by over 55% in less than a month.
As expected, Ethereum pulled back after reaching our second target. The market was in overbought territory so it needed time to cool off. If the market was still bearish, the retracement should have driven price down to recent lows of $103. As you can see on the chart, Ethereum has no plans of correcting to such low levels. This encourages us to long the market again.
Technical analysis shows that ETH/USD is creating a second higher low just above our range midpoint of $123.50. The ability to stay above the range midpoint is bullish. This tells us that participants are eager to buy the dip. They are front running those who are looking to buy close to our support of $123.50. Consequently, those who were waiting to buy at the support will likely be forced to buy higher. This is how bull runs get started.
With a second higher low in place, Ethereum appears to be printing an ascending triangle pattern. The pattern plays well to our expected sentiment of buyers front running each other. This will drive prices higher and push the market above our range high of $162.
The strategy is to buy on dips as close to $135 as possible. As long as ETH/USD trades above this level, it will likely rally to our initial target of $162. Take that out and the next target is $250.
The process may take less than a month.
Daily Chart of Ethereum/US Dollar on Bitfinex
As of this writing, the Ethereum/US Dollar pair is trading at $140.26 on Bitfinex.
Summary of Strategy
Buy: As close to $135 as possible.
Targets: $162 and $250.
Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.