Bitcoin & Ethereum - Be careful!

For Bitcoin, as well as Ethereum, it is still important to be careful. The bulls still have not secured the upward trend and the alternative scenarios are with probabilities of 40% and 45% to be considered quite likely. Additionally, the indicators also seem to hint a more comprehensive correction. However, we want to stress that this does not alter our overall long-term orientation in this market. Instead, we believe that such a correction would positively affect the market and foster a more vital upward move afterward. Needless to say that this would open the door for new entry chances.

Since it's low at $43800, the bulls could push upwards and extend a preliminary high. Problematic, however, is that this could well be interpreted as a 3-step movement as well, which would mean that this is a correction. In this case, we would face a more comprehensive correction with some preliminary lows. If the bulls are to take over again, they will need to rush to establish a stronghold above the threshold of $52,000. If they are able to do so, we can label the current structure as a 1,2-Setup. Such a movement would function as the cornerstone for wave v in orange. Our preliminary expectation is also that we will experience a further rise, as long as the price for Bitcoin stays above $43,802. However, the alternative correction still gets a very high probability of 45%. In the second chart, we have outlined the possible alternative correction. Here, we see that wave [3] in green is completed and would run into an area between $35,000 and $30,000. We already have indicated a trading zone there. If the correction turns out to become a reality, we will use this zone to build up long positions further. Once we approach the trading area, we would also specify the coordinates further. In any case, with the superordinate wave [5] in green we will attack new highs either way.

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The situation for Ethereum is much more relaxed. Since it is already a couple of waves farther, the downward extension still has some more room, although the bears managed to reach the ideal target in wave four. Currently, we expect a deeper decline into the indicated trading zone and that the price for Ethereum reaches the region around $1,200. The structure that the bulls are working on since the most recent low point is not really convincing at this point. In addition to that, the countermovement has not established a preliminary high.

h2 Ethereum Technical Analysis

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Moreover, the indicators, too, hint that a deeper penetration of the trading zone is thinkable. As long as we stay above $1,175, such a movement would not be much of concern. However, if the bulls cannot defend this mark and fall below $1,175, we will see, just as we would with Bitcoin, a more comprehensive correction towards $600 in Ethereum. There is a high chance of 40% for such a movement to occur for the time being. Hence, we are also at a critical crossroads in Ethereum. But we also need to bear in mind that if such a bigger correction sets in, we will see much higher prices in the future. Given the bulls manage to complete the turnaround within the trading area, we will face prices of above $3000. However, we are not there yet, and the bulls do not show any clear signs that the correction is completed.

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Written By: Philip Hopf