Ethereum Analysis and Talking Points
– Recent rally may have further upside momentum but charts remain negative.
– Retail trade data show traders remain heavily long ETH.
IG Client Sentimentshows how clients are currently positioned in a wide range of cryptocurrencies and how positioning has changed over the last week – and positioning continues to look highly stretched. ETH positioning shows retail are 92.5% net-long and increased long-exposure over the last week. A combination of positioning and recent changes gives us a strong Ether bearish contrarian trading bias.
Ethereum’s Recovery Continues from a Low Base
The second-largest cryptocurrency by market capitalization, Ethereum, has pulled back from the recent abyss and is back above a noted technical chart-level at $497. This December spike low was made just before the sharp rally to ETH’s all-time high at $1,420 made on January 14. A strong break lower could see last week’s $450 level taken out opening the way to the support zone between $397 and $359. For the recent rally to continue, the February 6 low at $568 needs to be re-broken which would then leave the 50- and 200-day moving averages at $630 and $662 respectively as the next levels of resistance ahead of 61.8% Fibonacci retracement at $669.
While the overall trend remains negative, an extension of the current rally cannot be ruled out and may provide holders an opportunity to lighten positions.
Ethereum (ETH) Daily Price Chart (October 2017 – June 19, 2018)
Cryptocurrency Trader Resources
If you are interested in trading Bitcoin, Bitcoin Cash, Ethereum, Ripple or Litecoin we can offer you a wide range of free resources to help you in your journey. We have an Introduction to Bitcoin Trading Guide to help traders make more informed decisions, while we also run a Weekly Bitcoin Webinar where we look deeper into current market trends and exam the latest technical chart set-ups and market pivot points.
For traders who use technical analysis, we have a wealth of articles and videos explaining the nuances of various indicators and how to use them and become a better trader. You can access these free resources via the DailyFX Education Center.
What’s your opinion on Ethereum? Share your thoughts and ideas with us using the comments section at the end of the article or you can contact me on Twitter @nickcawley1 or via email at nicholas.cawley@ig.com.
— Written by Nick Cawley, Analyst.
