Ethereum drifted higher a bit during the week ending October 18th, inching towards the $375 level. As long as Ethereum maintains its uptrend and holds critical support levels, it leaves the door open for a much higher wave pattern (pictured below).
(October 18, 2020 8:00 PM EST)
Outlook: Looking at Ethereum's charts, I'm still a little befuddled it's valued at less than $400. Given recent ETH 2.0 launch updates and Vitalik Buterin's declaration that ETH 2 will launch by end of 2020, fundamentally I can't be bearish. When you factor in the technical analysis, you also see a classic uptrend and ascending pattern pointing to higher prices. The question is: How high? As you can see in the 4-Year chart below, Ethereum may have put in a corrective Wave 2, thus cementing an inflective support level that theoretically points to a higher high in the form of an impulsive Wave 3. Bear in mind, this is a Weekly chart, so this analysis is not due to play out this week. However, it lines up very well with our prognostication that Q4 - 2021/2022 the beginning of another bull market cycle in crypto, with Bitcoin and Ethereum leading the charge. In my rough EWT wave count below, I think Wave 3 takes us to at least the $700/800 range, which if you follow us, you'll know we've been saying Ethereum is undervalued according to the stretched ETH/BTC ratio for some time now, and a proper recalibration of this ratio should slingshot ETH to at least $600-700.
Support: Ether is currently trading well above the 50 and 200 Week EMA's, which should act as major long-term support below around ~$255-265, which is also around the 50% fibonacci retracement level. If ETH falls below the 200 Week EMA around $250, the overall uptrend is in jeopardy. I gather this is extremely unlikely and only accomplished via the entire network being taken down, or another COVID-related March-caliber sell-off; even then, we see such an event as short-term weakness and an excellent opportunity to add and a medium-long term accumulation zone. Federal Reserve money-printing has shown that price dips on assets will be shallower as their inherent valuation relative to fiat is stronger and perpetually increasing in strength.
Resistance: Next immediate resistance is $400, which is both a round psychological number but also a lower historical resistance point. After that, look for resistance around the June 2018 highs around $500, and then $550/600. Look for resistance every $50-100, notably 2018 waves down, which should act as resistance as ETH attempts to reclimb these levels. Also, remember that Bitcoin has already climbed back 60% of the way to its previous all-time high, yet ETH is still down almost 70% from its January 2018 all-time high of $1,400. $1,000 will assuredly be massive resistance, which I don't forsee ETH recapturing just yet.
About Us:
I take time out of my day to share these with the community completely free. If you enjoy these posts, please support the channel by "Tipping" this post below, or using either of these referral links below. They cost you nothing and give me a small reward, which makes me a little happier to share these personal analyses with you at no cost.
Buy Ethereum here.
Earn Ethereum here.
