by Jamie Holmes
ETH-USD broke above the upper limit of the previous range at $11.20 recently, confirming bullish momentum. Therefore, the market is now looking to establish further gains and participants should look to buy ETH-USD. A recent positive announcement from BTCS Inc. may enhance bullish sentiment for ether, as the company has enlarged its Ethereum mining operations by a factor of three. BTCS Inc.’s management believes it can expand on Ethereum mining with its experience and access to capital, helping the company to diversify away from bitcoin. Moreover, the decline of Ethereum Classic is intensifying, allowing ether to assert dominance.
The price of ether currently stands at $12.19995 on the Kraken exchange and the chart below illustrates the long-term outlook. The market managed to close higher than the most recent fractal sell level suggesting bullish momentum will dominate over the coming week. This is indicated on the chart below, where yesterday’s close was $12.23 above the fractal resistance at $11.58999. The next fractals providing resistance lie at $12.69 and $15.23. However, also notice that after a prolonged period of trading outside of the Ichimoku cloud, the market has now moved into the cloud, suggesting the market is finding the equilibrium price for ETH-USD.
The Ichimoku cloud is also known as the zone of equilibrium. Also, the flat upper span around $15.39 will attract the price action and see ETH-USD tend toward this level. Therefore, the market will look to rise and penetrate the Ichimoku cloud further until $15.39 at which point it will likely gyrate around this resistance or head down, continuing to trade within the cloud.
Moreover, notice that the preceding three days have seen increasingly higher volumes which suggests we should anticipate further appreciation in ETH-USD. Moreover, the Awesome Oscillator is looking as if it will turn to positive values soon and is trending higher, indicating stronger upward momentum over the long-term. The bullish outlook will be invalidated if the market moves below the low at $10.84396 and would serve as a stop loss for buy positions.
Whereas ether has recovered in price recently and looks to make further gains, Ethereum Classic has fallen drastically from recent highs, plunging below the $2.00 threshold. The 4-hour price action of ETC-ETH on the Poloniex exchange is shown below, displaying a bearish outlook. Downward momentum is expected to dominate as the market has broken below fractal support at 0.1427 and the conversion (blue) line is trending below the base (red) line. Moreover, the Awesome Oscillator is negative and trending lower.
Next supports lie at 0.1231180 and 0.0900000 for ETC-ETH. The chart above also shows that the lagging line (purple) has moved from above to below the Ichimoku cloud, which gives strong confirmation that the downward trend will continue. Also, notice that volumes traded on the Poloniex exchange have fallen substantially, suggesting decreased interest in Ethereum Classic.
The strength of the downward momentum in Ethereum Classic against the US Dollar is illustrated below. A break below fractal support around $1.55 will see a move that will look to take Ethereum Classic below $1.00. The strength of the downward momentum is signalled by the downward trending Ichimoku cloud and the steepening downward angle of both the conversion line and the base line.