Ethereum (ETH/USD) continued with the uptrend and made another higher high as expected. Price action has now reached the first -27.2% Fibonacci target.
Can the uptrend continue higher? And if so, what are the next targets?
Price Charts and Technical Analysis
The ETH/USD completed a bearish ABC (grey) pattern in wave 4 (pink) after bouncing at the 38.2% Fibonacci retracement level (blue box):
- Price action has reached the first -27.2% Fibonacci target (smaller blue box).
- The momentum is very strong because of these reasons:
- Daily candles are showing an impulse with a majority of large bullish candles closing near the daily high.
- The HMA 20 has a bullish angle with price action above it.
- The momentum indicator confirms that 10 daily candles have not hit the 21 ema zone (green box). Usually the momentum continues (see green boxes before) higher.
- The 21 ema zone has a steep angle and all of the moving averages are bullishly aligned with large spaces between the MAs.
- Considering the strong momentum, an immediate continuation has the highest probability (blue arrow).
- The next targets are at the -61.8% Fibonacci level around $2800 and the round $3000 level.
- The upside is probably part of multiple wave 3 patterns (purple/red).
On the 1 hour chart, price has been above the 21 ema for more than 1 week now. The bullish bounce at the 144-233 ema zone on the left of the chart was followed by another round of buying:
- The wave patterns suggest an ongoing wave 3 (grey) considering the strong bullish momentum.
- The current pullback respected the 38.2% Fibonacci of the shallow price swing. This could be a wave A (green) of a larger ABC (green) in wave 4 (blue).
- The 1st or 2nd breakout above the 21 ema zone (green arrow) could confirm the uptrend continuation.
- The uptrend certainly remains strong as long as price action remains above the 144-233 ema long-term MA.
- This wave outlook is confirmed if there are bullish bounces at the support zone and max 50% Fib. A break below the 50% Fib places it on hold (yellow) and a deeper retrace invalidates it (red).
The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter.