Ethereum Prices Rally into Resistance What Now?

(MENAFN- DailyFX) ETH/USD breaches through February opening-range highs; constructive above 162 Check out our 2018 quarterly projections in our Join Michael for Live Weekly Strategy Webinars on prices reversed sharply just ahead of slope support last week with the advance now challenging near-term downtrend resistance. A breach here would be needed to validate a reversal of the multi-month downtrend with such a scenario targeting a rally back towards the monthly open.

Ether Daily Price Chart (Log) Technical Outlook: Ethereum prices have rallied more than 70% off the February lows with the advance now testing confluence resistance at ~953 where the 38.2% retracement of the decline converges on the upper parallel of the descending pitchfork. The immediate advance may be vulnerable here near-term and we're looking for a reaction off this mark into the close of the week.

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A breach higher targets the monthly open at 1105 backed by the 61.8% retracement at 1198. Daily support rests with the 2018 low-day close (LDC) at 783 with our bullish invalidation now raised to the 100-day moving average at 738.

Ether 240min Price Chart (Log) Notes: A closer look at Ethereum price action further highlights near-term resistance here at 953. Look for interim support at the median-line / 822 with our near-term bullish invalidation level raised to the low-day close at 783- both areas of interest for possible exhaustion / long-entries IF reached.

Why does the average trader lose?

A breach targets subsequent resistance objectives at 997 backed by the 50% retracement a 1075, 1105 and the 100% extension at 1132. Bottom line: It's make-or-break here for Ether and the risk remains for a pullback while below near-term resistance. I'll favor fading weakness into structural support OR buying a break and retest of near-term resistance as support for a move back towards the monthly highs.

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ETH/USD IG Client Sentiment A summary of shows traders are net-long ETH/USD- the ratio stands at +9.03 (90.0% of traders are long) bearishreading Traders remained net-long since Jul 7th; price has moved 279.5% higher since then Long positions are 1.5% higher than yesterday and 1.3% higher from last week Short positions are16.2% lower than yesterday and 3.7% lower from last week We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Ether prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current positioning and recent changes gives us a stronger Ether-bearish contrarian trading bias from a sentiment standpoint. See how shifts in Ethereum retail positioning are impacting trend-

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- Written by Michael Boutros, Currency Strategist with DailyFX

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