Jack's Trading Classroom | Shorting ETHUSD for the short term

On July 20, 2021, we published a technical analysis titled "ETHUSD Inverted Cup and Handle Pattern Waiting for Breakdown", in which we mentioned that Ethereum had shown two bearish conditions with the appearance of the Vegas Tunnel in the past few days.

ETHUSD has temporarily failed to break below the low point of the inverted cup and handle pattern on the daily chart. Today, we also see the one-hour candlestick chart of ETHUSD, where Ethereum briefly rallied to the resistance channel of EMA144 and EMA169 moving averages, indicating a channel retracement completion.

This resistance channel overlaps with the 38.2 Fibonacci retracement level at 1887.65, showing a decreasing trend as higher highs turn into lower highs above.

Next, we should focus on the lower EMA12 filter line. If the price crosses above the EMA144 and EMA169 resistance channel before crossing above the EMA12 filter line, and the candlestick closes below the EMA12 line, it is considered a setup for short positions, with the stop-loss point set at the previous high of the retracement channel.

The current quote for the EMA12 filter line is 1823.53. Note that the EMA index moving average will change with time, so the current chart should be the reference point.

In recent days, the digital currency market has seen significant volatility. It is recommended for traders to strictly implement risk management measures and avoid high leverage and high contract volume trading to prevent additional losses caused by volatile market conditions. This article is for personal commentary only, please use caution when considering, as cryptocurrency trading may pose risks to your capital.

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