Trade Recommendation: Ethereum

Ethereum

Our May 21, 2019 trade recommendation for Ethereum (ETH/USD) hit its initial target. On June 21s, the cryptocurrency climbed as high as $297.71. Those who stuck to trade plan grew their investments by over 30% in one month.

Our second target of $365 for Ethereum still applies. However, we are releasing a fresh trade recommendation so those who took profits at $297 can buy the pullback. If you have yet to hop on this train, the next several days should offer you a solid entry point as Ethereum is flashing overheated signs. The breakout rally appears to be fading as we’re seeing a bearish divergence and overbought signals on the daily RSI.

Technical analysis shows that ETH/USD has broken out of the large cup and handle pattern on the daily chart. This happened on June 21st when the market breached resistance of $280. The breakout is what’s fueling the cryptocurrency’s current rally.

As mentioned, Ethereum is ripe for a short-term correction. Ideally, the cryptocurrency retests and converts the previous resistance of $280 into support. We want to see it build a new base above that level before targeting $365.

The strategy is to buy on dips as close to $280 as possible. As long as ETH/USD trades above this level, it will likely rally to our range high of $365. We’ll revisit the market once it closes above that price level.

The process may take less than a month.

Daily Chart of Ethereum/US Dollar on Bitfinex

Ethereum crypto chart
As of this writing, the Ethereum/US Dollar pair is trading at $311.50 on Bitfinex.

Summary of Strategy

Buy: As close to $280 as possible.
Targets: $365
Stop: $267

 

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.

Kiril is a CFA Charterholder and financial professional with 5+ years of experience in financial writing, analysis and product ownership. He has passed all three CFA exams on first attempt and has a bachelor's degree with a specialty in finance. Kiril’s current focus is on cryptocurrencies and funds, as he does his own crypto research and is a Product Manager at Mitre Media. He also has his personal website, InvestorAcademy.org where he teaches people about the basics of investing. His ultimate goal is to help people with limited knowledge of finance and investments to create investment portfolios easily, and in line with their unique circumstances.