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【TA Testing Column】New Dimension | 20200914 BTC & ETH: ETH weekly chart completes bottom pattern

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【TA Testing Column】New Dimension | 20200914 BTC & ETH: ETH weekly chart completes bottom pattern

TA TESTING is currently a market analyst collaborating with Binance in the Taiwan market, focusing on the analysis of US stocks and the cryptocurrency market. With professional insights, TA TESTING will regularly share cases or strategies related to the cryptocurrency market in the New Dimension column, providing the community with a healthy channel to understand the cryptocurrency market and learn market analysis.

This is the first article of the New Dimension column.

Table of Contents

ETH Weekly Chart

Let's first look at the ETH chart. In terms of pure chart interpretation, we can see that after breaking through the long-term neckline support level at 300 USDT, ETH entered a pressure zone. After oscillating for the past two weeks, it has retraced from a high of 489 USDT to the current 355 USDT.

Compared to BTC, ETH is currently in a very clear position: testing support after breaking through the bottom. From a technical analysis perspective, this is a classic pattern completion. From a wave theory perspective, this is the gathering of bulls before the start of the main uptrend. The chart pattern is so clear that further explanation is unnecessary. More importantly, this is happening at the weekly chart level.

  1. In the red box on the left side of the above image is the trapped pressure zone during the 2018 bull market. At that time, all investors who chased the market high were trapped there. The main challenge of the next bull market is to overcome the pressure within the red box. The resolution process is bound to be difficult, and whether one can endure it depends on whether their entry cost is low enough.
  2. The first resistance in the red box is near the neckline at 350 USDT, where this neckline has kept the price below 400 USDT for the past two years. The green box in the chart below represents the bottom formed by the price consolidation over the past two years.
  3. Observing the price volume breaking above the yearly average (currently the ETH daily MA365 is at 215 USDT), all moving averages are turning upwards. Currently, the long, medium, and short-term trends are all bullish.
  4. The upper bound of the green range is a resistance level that has not been broken for about two years. After a long period of consolidation, it has finally broken through recently, indicating the completion of a bottom pattern. This suggests that ETH is likely to follow the weekly trend, worth paying attention to.
  5. Currently at a position of "retracing after breaking through the long-term bottom neckline," a standard completion of the bottom pattern.
  6. Bullish trend worth watching.
  7. Risk Warning: Considering global financial market risks at this time, it is not advisable to use large funds to enter the market. Be prepared for "war-level" black swan events. The financial market will not recover until after the first quarter of 2021, with lower risks.

Finally, let's conclude with this image:

Disclaimer:

The content of this article is for educational purposes only and does not constitute investment advice. Cryptocurrency markets are highly volatile, so please invest cautiously.

Personal subjective opinions may not be suitable for everyone and are for reference purposes only, not trading advice.

All analysis is based on the current market conditions and does not predict future market changes. The author's analysis is for personal interest and does not track all subsequent developments. It is recommended to maintain flexibility and adaptability in operations.

[This article is authorized for reprint by TA TESTING. Please refer to this link for the original article.]