Good day Hiveians!
Join me in analyzing the crypto markets!
So I like to be critical of my own analysis as this gives myself the possibility to improve! The last post on ETH was "ETH ready to tacke off...". Well... I guess not so fast. We are down to 1.3k when I thought we would be at 2.5-3k... Was this a failed prediction? Yes and no!
What I mean by that is that it all depends on the time scale. While we are not there yet, I would strongly suggest that we will be at that upper price level very soon. So predictions get really good when they can factor in a movement within a given time frame. While I wasn't too specific on that I would argue now that we are still on track to the bullish scenario.
Before I explain, however, let me start with a caveat: In the last weeks/months there has been a shift of attention to the binance smart chain and a considerable increase of development/opportunity on that chain. The reason behind this is that ETH fees are killing sentiment and projects... This is extremely bearish for ETH as this normally is death sentence in a competitive market. If your rivals (i.e. binance smart chain) have a big advantage over you (i.e. ETH chain) for a long time, then this generally means that you will not survive. While this is a strong argument it should also be said that binance isn't necessarily an ETH killer... Binance chain is much more centralized (hence it is called a CeDefi) and doesn't nearly have as much development ongoing. ETH will also upgrade to ETH 2.0 in several years, which ill address its problems. Nevertheless that's still a long time... So I think it would be premature to call ETH "dead", it is anything but. For now, let's leave it at the saying "time will tell"...
So with this background, let's dive into the analysis! :)
This is the chart that I have shown often before. You can see the two ovals which mark the same fractal. The thing that is surprising to me (if it is confirmed) is that this pattern took much longer to play out as I expected. Let's have a closer look, to get a clearer picture...
This is the pattern from 2017: It is extremely similar to the current pattern. Forreference I labeled numbers from 1-4. This should make it clear. What we see is that the correction from 2 to 3 happened very fast here (1-2 weeks). This correction is the one that we are currently in I believe. While in the previous posts I thought that we had already experience this concretion, it is now clear that it took a lot longer to play out. But if so, then this is good news, as we can expect a big rally in the coming weeks. This would be the impulse wave to 4.
Compare this with the current pattern. Do you see the similarities? Notice the much longer top in 2. This is what caught me off guard. It happened over 2 months, not 2 weeks... The correction to 3 is currently ongoing. As you can see this would take us down to about 1000$! However, I think it is realistic to assume an area of 1-1.2k as a correction all the way down to 1k would imply a 50% correction. Last time it was only about 22%.
While a correction to 1-1.2k is brutal, it would completely validate the pattern that I have assumed all along to play out. So this would be actually a positive development as a rally to 2-3k and beyond is almost guaranteed. If this happens, ETH will also overtake BTC by perhaps as much as 100% in the coming weeks... ETH should bounce off of the long support line seen here in the ETH/BTC chart:
As a general reminder: Please keep in mind that none of this is official investment advice! Crypto trading entails a great deal of risk; never spend money that you can't afford to lose!