Ethereum went in both directions on Wednesday, rising and falling to eventually close a few points lower on the daily chart. ETH formed a bit of a bearish doji candle, indicating a degree of volatility and possible trend reversal.
(November 18, 2020 8:30 PM EST)
Outlook: Ethereum traded in both directions Wednesday, reaching up towards the $500 level and swinging as low as the $450 before settling slightly negative on the day around $475. ETH former a new local high but seems to be experiencing some turbulence in this $50 range, facing selling pressure closer to $500. Bitcoin’s dominance and bearish volatility today didn’t help, as well as legacy markets selling off to end the NY trading day. If ETH breaks up, we need to see an impulsive break of $500. If ETH pulls back, look for a base of support, probably closer to $400.
I think any bearishness in ETH is short-term and concludes by Q1 2021, and the rest of 2021 should feature the phased launch of ETH 2.0, and probably another record-setting round of US and EU stimulus helicopter money to buoy markets, inadvertently benefiting crypto as well.
Support: Look for support at $400, which is a major inflection level for ETH, former resistance = new support and the 50 Day EMA. so it should now act as new support. Lower, look to $350, then the 200 Day EMA which is trading just north of $300.
Resistance: It seems we may have our breakout above $450, so I’m looking for another test of $500. After that, expect moves in $50-$100 increments. I think the upper range of this move is somewhere between $500-600, but it wouldn't be surprising to see a wick higher before an EWT retracement.
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