TA of the Day: Will Ether (ETH/USD) Soar to New All-Time Highs?

He is ether (Ethereum/US Dollar) Heading to $5,000 and beyond?! 😲

in NB For clients, Matt Hogan, chief investment officer of Bitwise cryptocurrency index fund, expects the price of ether to reach an all-time high above $5000 Due to ETF inflows into the Ethereum exchange.

Hogan expects the first few weeks after the ETF launch to be “turbulent” for ether, but by the end of the year, he is confident that new highs will be reached.

If you’re not up to date on Ethereum news, the U.S. Securities and Exchange Commission Eight Ethereum ETFs Approved From different issuers. The approval is seen as a huge achievement for the crypto industry as it provides investors with a new way to gain exposure to Ethereum.

Hogan believes that spot Ethereum ETFs will attract $15 billion net inflows in first 18 monthsSuch large flows would push the price of ETH/USD to New record highsIf the flows are stronger than many market commentators expect, the price could be much higher.

If you are new to Ethereum and cryptocurrencies, visit our Cryptocurrency School.

Sounds optimistic, but what about the technical data?

Welcome to TA of the Day (TAOTD)! 👋

Here is the daily chart:

The chart shows the price movement of Ether (ETH) against the US Dollar (USD) on the Coinbase exchange from the beginning of 2024 until July 18, 2024.

📈 Technical analysis of the daily chart of the ETH/USD pair

Using the technical analysis concepts we covered in our Forex course, let’s analyze the ETH/USD pair.

Moving averages:

SMAs:

• 10 period simple moving averageIt is located at 3,254.98. The current price is: above This level indicates short-term bullish momentum. The slope is to the topindicating short-term strength.
• 50 period simple moving averageIt is located at 3,445.13. The price is a little high. less This level indicates that the recent uptrend may encounter resistance. The slope is downindicating weakness in the medium term.
• 200 period simple moving averageIt is located at the level of 3,152.08. The price is: above This level indicates long-term bullish momentum. The slope is to the topindicating a continuation of the long-term upward trend.

If you are new to moving averages, read Pipsology School’s lessons on how to use moving averages.

Relative position of moving averages:

• the 10 period simple moving average currently less the 50 period simple moving averageindicating that the short-term trend has been weaker than the medium-term trend until recently. The recent price action above the 10-period simple moving average suggests a potential short-term uptrend.
• the 50 period simple moving average He is above the 200 period simple moving averageindicating that the medium-term trend is more bullish than the long-term trend. However, the price currently sitting below the 50-period simple moving average indicates potential resistance in the medium term.
• the 10 period simple moving average He is above the 200 period simple moving averagereinforcing the overall long-term uptrend.

If you are new to moving average crossovers, read our Pipsology School lessons on moving average crossovers.

MACD:

• MACD lineThe line represents an upward trend, indicating upward momentum.
• signal lineThe line represents an upward trend, indicating upward momentum.
• HistogramThe chart is positive, indicating bullish momentum, but it appears to be decreasing, indicating a possible weakening of the current uptrend.

If you are new to the MACD indicator, read our Pipsology School lessons on how to use the MACD indicator.

Volume analysis:

• Size trendVolume has been relatively stable with occasional spikes. Recently, we have seen volume spike during price increases, indicating strong buying interest.
• The relationship between size and priceRecent price increases accompanied by increased volume indicate that the upward movement is supported by strong buying interest. Conversely, price decreases have been accompanied by decreasing volume, indicating less selling pressure.

🕵️ Key Notes

Price movement:

• UptrendThe price has been in an uptrend since early 2023, marked by higher highs and higher lows.
• revisionRecently, the price has corrected from its peak at around 3,800 and is currently trying to resume the uptrend.

Support and resistance levels:

• Supports:
  • Immediate support is located at around 3,255, which is in line with the 10-day simple moving average and the recent low.
  • 3,150 (horizontal level, coincides with 200 period simple moving average)
  • 2,800 (horizontal level, previous low)
• resistance:
  • Immediate resistance is found at around 3,445, which coincides with the 50 simple moving average and the recent high.
  • 3,500 (horizontal level, previous high)

If you are new to support and resistance, read our Pipsology School lessons on how to use support and resistance levels.

Moving averages:

• The 10 simple moving average is currently acting as support.
• The 50 SMA acted as resistance during May and June but was briefly breached in early July. The price failed to stay above the 50 SMA and has now returned below it to act as resistance.
• The price action in early July tested the 200 simple moving average as support, indicating a potential weakening of the long-term bullish momentum.

If you’re new to moving averages acting as support and resistance levels, read our Pipsology School lesson, How to Use Moving Averages as Dynamic Support and Resistance Levels.

MACD:

• The MACD is currently above the signal line, indicating bullish momentum. However, the declining histogram suggests that the bullish momentum may be weakening.

🤔 Possible trade scenarios

He is ETH/USD Buy or Sell?

The following trading scenarios are provided for educational purposes only. Since they do not include full risk management practices, they are not intended to serve as actual trading recommendations, but rather as food for thought to help you generate your own trading idea.

Long bias:

• Point of ConsiderationConsider entering a long position if the price finds support near 3,255 and shows signs of a bounce, such as a bullish candlestick pattern or positive divergence. Additionally, a break above the resistance level at 3,445 with strong trading volume could indicate a continuation of the uptrend.
• Point of cancellationConsider setting a stop loss below the support level at around 3200 to manage risk.
• potential targetWe expect a move towards the 3,600 level and above if the uptrend resumes.

short bias

• Point of ConsiderationConsider entering a sell position if the price fails to break the resistance level at 3,445 and shows signs of bearish momentum, such as a strong bearish candlestick pattern or negative divergence.
• Point of cancellationPlace a stop loss above the recent high at 3500 to manage risk. This level is very important as a break above it would invalidate the bearish setup.
• potential targetThe initial target could be the support level at 3,255. If the downward momentum continues, expect further decline towards 3,000 or lower.

📝 TAOTD Summary

• directionThe long-term trend appears to be bullish, but the short-term trend is showing some resistance around the 50 simple moving average.
• Main levelsSupport at 3,255 and resistance at 3,445.
• PaidThe MACD indicates bullish momentum, but the falling histogram indicates that this momentum may be weakening.
• amountHigh volume during a recent price rise indicates strong buying pressure, while low volume during a price decline indicates low selling pressure.
• Moving average analysis:
  • An upward slope on the 10-period simple moving average indicates short-term bullish momentum, while a downward slope on the 50-period simple moving average indicates medium-term resistance.
  • The upward slope on the 200 SMA reinforces the long-term uptrend.
  • The relative position of the moving averages shows that while there is an uptrend in the short and long term, it may be necessary to overcome medium term resistance to make further gains.

This content is for informational purposes only and does not constitute investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to ensure you understand the risks involved.