Bitcoin has been strong and therefore it tends to drag other crypto right along with it, including Ethereum.
Ethereum has seen a strong run higher as we are switching over to a “proof of stake” format. That being said, the technical analysis continues to be very bullish, especially as we continue to see the $3000 level offer support as they market has tested it over the last couple of sessions. By doing so, it suggests that the market is going to continue to pay close attention to this large figure, and perhaps use it as a “floor the market” all things being considered.
The last month has been extraordinarily bullish, as we have only seen three red candlestick. The session on Monday of course did turn things back around to form a little bit of a hammer, and if we can break above the top of the candlestick on Monday, then it is likely that we go looking towards the 3500 level. Ethereum does have the proclivity to move in $500 increments, so that is worth paying close attention to. At this point, I still like the idea of buying dips in the Ethereum market, as it is obvious that we have entered a new bullish phase. This is not to say that we cannot fall a bit, just that the likelihood is that the market will continue to attract a lot of value hunters.
A breakdown below the $3000 level could open up a move down towards the $2500 level, which is where the 50 day EMA currently sits. The 50 day EMA has been an indicator that a lot of people will pay close attention to, and therefore it could also offer another opportunity to get long. On the other hand, if we were to break above the top of the candlestick for the trading session on Monday, then it is likely that we will go reaching towards the $3500 level above. Nonetheless, I do not have any interest in shorting anytime soon, especially if we continue to see crypto in general do quite well. After all, Bitcoin has been strong and therefore it tends to drag other crypto right along with it, including Ethereum. We are a little bit over stretched at this point, so a little bit of a pullback would make quite a bit of sense, nonetheless. Ultimately, I think that it is going to continue to consolidate before taking off again, as it has been quite bullish and may need to take a bit of a breather.