Ethereum was lifted by the crypto market buoyancy since 8th February. Will this continue? The following look at the technical side.
February 12, 2019 | AtoZ Markets - The entire crypto market was bullish on Friday. Ethereum extended the Friday gain for two days. After gaining 22%, Ethereum overtook Ripple and reclaimed its second spot in the crypto market cap table according to CoinMarketCap. Its market volume has also gone higher. By contrast, Ethereum trading volume at $3 billion (as of the time of this report) is about half of Bitcoin's and more than seven times larger than Ripple's. Its market cap stays at $12.69 billion, a bit more than Ripple's. Will Ethereum climb further?
Ethereum peaked at $1400 in mid-January 2018 but became one of the most affected by the 2018 bearish trend. After losing around 92% from its peak price, Eth is looking more likely to drop to the early 2017 price levels if the current recovery is overwhelmed by the bearish pressure once again. Many technical experts believed price would start a real recovery or at least make a very big bounce to $400-500 after bullish reversal patterns were spotted on their price charts.
Ethereum Price Prediction: What Next?
The chart above covers price activities from April 2017. It shows a 5-wave rally to 1400. According to Elliott wave theory, an impulse wave is usually followed by a 3-wave correction. Since price peaked at 1400 in mid-January 2018, it has dropped unrelentingly. The drop, however is a long term correction. This kind of scenario has happened twice since 2010 when Bitcoin was first introduced. This outlook therefore, is giving hope especially to technical enthusiasts. If this forecast would work out, it means price would peak again. When that would happen or how quick it would, is difficult to say.
Furthermore, we have in the past discussed how the recovery would happen. A 5-wave up followed by a 3- wave down and a break of the top of the 5-wave swing. With these three steps, we can count an impulse wave upside and stand on a better ground to talk about a recovery. The first two steps seem to have happened. After the November 2018 bearish breakout, most cryptos hit new lows. Ethereum hit $80 and then rally swiftly at the end of the year to complete the first step. In mid-January 2019, we looked at how the second step could be i.e a 3-wave bearish correction. The chart below was used.
We expected that ''the current dip could continue to $90-100 before the next upsurge in(to) the region of $200 or more''. That was what happened as price dropped to $100 before Friday's big rally. Is something cooking? The chart below shows how the third step of the recovery should be.
The dip has happened to $100 indicating 80-100 as the important sell-off support zone. A break below this zone will definitely lead to a new low. However, the bounce from $100 is relieving to the buyers. A slight dip, followed by a big upsurge above 161 top could set the cryptos on the path to recovery or at least the biggest bounce since the sell-off started.
Please share your thoughts with us in the comment box below.