The Ethereum market has gone back and forth on Thursday, essentially “chopping wood” just below the crucial 50-Day EMA. The market is more likely than not going to continue to see a lot of noisy behavior, but I think a lot of the Polish pressure in the Ethereum market is just about over with. This does make a certain amount of sense because everybody out there knows about the merger coming, and that news has already been baked into the price. Unfortunately, a lot of retail traders will continue to buy this market as we are getting close to the actual event. Institutional money has already been in and out of this market.
Ethereum continues to see the $1500 level as important, but I think at this point if we break down below the lows from a couple of days ago, it continues the downward pressure to the $1200 level, possibly even down to the $1000 level. Because of this, this is a market that I think a lot of people will be looking to short this market on signs of exhaustion.
Focusing in the Long Term
- On the upside, if we can break above the $1700 level, then it’s possible that the market could go looking through the $2000 level.
- The $2000 level also features the 200-Day EMA as well as the previous action, and of course, the fact that it is a large, round, psychologically significant figure.
- Obviously, if we break above that level, then there would be a lot of headline noise and it’s possible that we could go much higher.
On the other hand, if we were to break down below the $1000 level, then the market could unwind quite drastically. This would send Ethereum back down to the $400 level, where we had taken off previously. That obviously would be a complete round trip, and therefore it’s likely that the market will see a lot of “market memory” in that area, and I think a lot of people would start to scale and for longer-term trade, I know I would. At that point, I would start accumulating Ethereum over the longer term, and therefore would hope to get a huge position over the course of the next couple of years. Whether or not we get that breakdown is a completely different question, but it still looks very possible.
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