Ethereum has gone back and forth during the course of the trading session on Thursday to show a little bit of hesitation, but quite frankly that something that the market needs to see due to the fact that the selloff has been so drastic and therefore any signs of hesitation has to be thought of in a positive light. That being said, I am not willing to jump in and start buying hand over fist, but as you know if you been paying attention to me at Daily Forex, I am a believer in Ethereum longer term.
Quite frankly, the Ethereum selloff has nothing to do with Ethereum itself, and everything to do with complete risk appetite collapse. That being said, if we break down below the hammer from the Monday session, then it is very likely that we collapse towards the $2000 level, possibly even down to the $1750 handle. All things being equal, this is a market that I think will offer plenty of opportunity at the margins, but with this being the case, I think the market is probably one you need to build up a position over the longer term, as I think much like many other of these crypto markets, you have to think of it more as an investment. This is because you can get these nasty swings lower, just as you can get a massive shot higher. All this being the case, the $2500 level offers a little bit of resistance, but if we can break above the highs of the trading session on Wednesday, we could go looking towards the $3000 level above.
If we do break down below the lows of Monday, then I would be a bit more aggressive at lower levels. Ultimately, this is a market that will continue to be noisy, so therefore you need to be a bit cautious, but that being said I think that the market is one that you cannot short, especially as we see such a massive selloff previously, so therefore you cannot chase the trade. Before you know it, crypto will decide to make a turnaround, but we may enter a bit of a “crypto winter”, which is code for accumulation phase as you see in various stock markets. Ultimately, I am looking to build an even bigger position for the next bull market.
