Ethereum TA Discussion: Part 2 (A few things I missed)
I recently made a post which discussed some Technical Analysis thoughts for the current Ethereum chart:
https://steemit.com/trading/@xaero1/ethereum-ta-discussion-bollinger-bands-tightening-due-for-a-breakout-or-break-down
After I made the post, I thought of a few more things about the current situation - so I've therefore made this extra post so that I could mention these additional points (as follows) :)
(1) What's bitcoin doing (fundamentals)?
It seems that at the moment, bitcoin is having quite a significant influence on the rest of the market. First thing to mention is that there's a plan for a new coin called 'Bitcoin Cash' (BCC) to be forked off on August 1st. Could this lead to volatility or decline in the price of bitcoin as this date approaches, and could this affect the rest of the market? On the other hand, segwit should activate soon. However, although generally regarded as a positive enhancement, there's always the chance that this could result in a 'buy rumour / sell the news' situation. During the recent activation of segwit on litecoin, for example, there was a spike up at the point of activation, but this sharply retreated immediately afterwards. In other words, maybe trading will be a bit less of a risky business after these events have been resolved (on way or another)?(!)
(2) What's bitcoin doing (technicals)?
Here's the 2-hour bitcoin chart (bitfinex):
This chart is very interesting because the gold EMA is just hovering above the cyan EMA. If we were to get a cross-over in the negative direction (gold line below cyan line), one might expect some sort of decline in price at least - maybe a 50% retrace (just to give an example). On the other hand, if the EMA lines stay positive (gold line above cyan line), then it's quite likely we might see another spike upwards, instead! Note: I marked the previous cross-over to the positive with the text 'Buy', but this is only in respect to a trading strategy that used this EMA timeframe for buy/sell decisions (and I am not advising use of this to the reader).
(3) I forgot to look for a triangle!
During a consolidation period, a 'triangle pattern' often forms (esp. in bitcoin, in my experience). On the current ethereum chart, it is not so obvious to me. The top line of a triangle is very clear, but the bottom line is less clear to me - if we're looking for a symmetrical shape, that is. Here's an example of one I drew:
As we can see, the top line is very well defined, but I've just randomly picked a single point for the bottom line - so there's not much science involved here :)
If we were to zoom in on this shape, we would see the following:
I then randomly drew some zig-zag lines to show what we might typically expect near the end of such a triangle, but in this case there is very little to support this particular pattern, since (as discussed) the bottom line of the triangle has been randomly chosen. Once a triangle nears completion, we often see the price move up or down (but it can continue sideways of course, too!)
(4) Finally, I missed one of the most obvious ways to approach trading in a situation where you might be looking for a break-out to occur. This is simply not hold the asset (ETH in this case), but to wait until the price has broken upwards to a certain level, before buying (i.e., 'buy the breakout'). Of course, if you wait for the price to move higher, then you are reducing your potential gain; but this method has the advantage that if your price target isn't reached for buying, and the price declines instead - then you don't make any loss, and you also don't have worry about if and when to sell. Also, many trading platforms support an automated way to buy if the price rises to reach a specific target, and this is known as a 'stop buy order' (although there are two variants: one which will trigger a 'market order', and one which will trigger a 'limit order' at a designated price).
But what price should one choose to buy at? This is entirely something individual must decide, but here's a couple of examples of places I might think to consider:
I've marked a light magenta arrow at the top of the b-band for this timeframe. A price point could be chosen slightly above this line for a stop-buy order / manual buy once it reached this point.
I've marked a dark magenta arrow where a horizontal line touches a few of the recent high price points. Again, the price to choose for a stop buy order would be slightly above this level. How far above to place order would be a matter of preference - e.g. $1,$2,$5, or something else. Note: I am not suggesting to the reader to use this approach and/or place stop buy orders at these levels, instead I'm only describing an example of this type of strategy.
Again, please let me know if this you have thoughts on these points/agree/disagree/have suggestions for better technical analysis!
DISCLAIMER: I am not offering trading advice. Any comments in this post are merely things I might consider doing, and I'm not advising the reader to follow any of these potential strategies. I am not advising the reader to either buy or sell Ethereum. The reader must take full responsibility for any trading strategies they use, in regard to anything read in this post.
"maybe trading will be a bit less of a risky business after these events
have been resolved (on way or another)?(!) "
I agree fully with you..
Thanks for extra post and for the info about bitcoin fundamentals and the effect of Bitcoin during this period to lead the other crypto..
The cryptocurrency market evolved much like a biological ecosystem..
The question is:
Can Bitcoin Continue to Lead the Cryptocurrency Market in future !!!
Wow.... cool pic! + thanks😄
My prediction that ETH would fall below 150 USD was correct. It went down as low as 135 USD. Now I think it may fall to 185 before 1st August. Lets see. Only few hours left.
Yup, looks to be falling. I just sold a few hours ago (should have sold at 209 for a nice profit too, instead of a small loss!😐)
Your predictions seem to have worked well!!😄
hahah..... but I didn't benefit from it. I just predict, and almost 90% of the time it is correct. It is just my intuition, but I never benefited from it. All my btc is stuck in ripple, lol.
But I learned a lot, and hope I will start making profits.
Aww...dang ripple!
I never have everything in one asset; and also I like to keep fiat at the ready to take advantage of any crashes (best time to buy!)
If you keep at this game long enough, quite likely your chances at making money will improve because there are many repeating patterns, in my experience. Good luck, anyway!😃
Thanks @xaero1 :)
Yes, I have noticed repeating patterns.
the moving averages are tending down.
Interesting analysis. As of right now as I type this, Eth is sitting at $223.15. If I were to buy Eth according to the 'buy the breakout' strategy that you described, at this point I'd probably buy once it hit back up to $230 again. I'm just starting to think about this stuff from a day trading perspective, but my rationale for this would be that it makes sense that it would be able to come back up to that position again since it was there a day ago. Once it gets there, there's likely a good chance that it can go up a bit further, so I would determine a price where I would sell it again too....say $240 or something like that....and then just wait until that happens. Of course if it goes down...then that's not the greatest....but you could likely safely hold until it gets back up to $240 again since it's not inconceivable for it to be there since it's been there before too.
Thanks for your comment! I was away... but at the time, I sold at $225. Reason being is that we got a 'lower high' and the distance between that high and the previous high, was greater than the distance between the previous high and the one before that. In other words, we seemed to be curving downwards.
In fact, I also put in a stop buy order too, just in case I was wrong (at around $235). Of course, it did not trigger...and so, I was able to cut my position pretty early and it worked out reasonably well for me.
Now: the 12-hour EMAs have crossed in the negative direction. Therefore, even though I'm tempted to buy in right now as the price is lower, my 'rulebook' is telling me to definitely stay away!!😃At some point either sooner or later this will change, but right now the TA (as well as btc uncertainty) allows me to have a few days away from trading (which is nice too ;) ).
Hope you're trading is going ok!
P.S. once the b-bands started to move in either direction, which they did(downwards).....then, it's no longer a potential breakout scenario in the same way. Sure, I could leave a stop buy order in place, but the price to chose would then be much more arbitrary .... and so probably I would just go back to using other TA tools (EMAs, MACD,etc) until we got the next b-band tightening situation, if that makes sense?
Must be a good trade day because I haven't heard from you in over a day now... I mean... who is counting? :P Anyways, hope you are doing well!
OMG LOL..... wonder what movie that is! Haha.... hey, I hope you watch it if you haven't before it's a classic!! ;)
Away this week, sorry!...haven't had much internet time 🙄Should be back to normal next week ;). Hope you can still sort my avatar sometime😆
Hehe. I haven't seen it, but I probably will watch it soon since I have so much time now! Me and my broken wing :) although I posted intro acroyoga lessons today... still want people to try acroyoga even if I can't at the time. You should try it too!!
Oh no! A whole week?? 😌 What will I do with myself.
Yes we need to plan the avatar... :) need more
Ideas on what you like!
Awww...I'm now thinking of a real poor cute fluffy bird with an actual broken wing 😉
Your comment are way toooooo nice though haha..... which for some reason made me think of this clip from an Eddie Murphy film when he finds something unbelievable (warning: don't view if this type of strong language / comedy thing isn't your cup of tea ;) ):
Thanks😆😆😆😆😆
🐥 Yup dats me, but my left wing would be at the side... gosh emojis need to step up their game! Lol need more emojis! One for every situation.
Hahahah are you referring to you trying acroyoga... or me missing my pen pal? 🤣 GTF outta hurr 😜
It was the latter:). But I hope you still like my sense of homour? 🙃 Actually, when I searched for the clip I typed in 'get outta town!' because I didn't even remember the exact language used in that clip!! Like I might just about use the former, but most certainly not the bit in that clip :). If someone actually said that to me, I might be like 'wait, what?' r u serious? 😆 But yeah... that's what makes it so funny, right?!
Like.... I just replied to someone else on steemit:
https://steemit.com/trading/@xaero1/ethereum-ta-discussion-bollinger-bands-tightening-due-for-a-breakout-or-break-down#@xaero1/re-diabolika-re-xaero1-re-diabolika-re-xaero1-re-diabolika-re-xaero1-ethereum-ta-discussion-bollinger-bands-tightening-due-for-a-breakout-or-break-down-20170728t000221425z
But I'm still very slightly thinking... I really hope that person understands my sense of humour too..but I cannot help myself :) If something is funny or clever, I really just got to publish and be damned 😈
Hahaha that's the best part about you. I always find people who have a good sense of humor to be very intelligent! 🤓
Did you get a chance to check out our funny acro tutorials? I want to know if your going to try out the moves! Totally doable! Maybe you'll meet someone on vacation and convince them to try it with you.
Are you already on vacation?
Also we have to start planning your avatar! Do you want it to be somewhat human like, robot, animal, human, magical creature, an elf? Hahah so many things you could be!
Will check :). What's your hourly rate for avatars....and what currency do you accept: steem, steem dollars, or beanie babies? ;)
Yes, vacation... back for next week.
I guess maybe something that looked a bit like a character from a video game? I like female models better generally...but not sure if that would come across as funny/strange/send the wrong message. I think it might🤣
Any general thoughts/ suggestions?
Whaddayathink? 😆
You are absolutley right. It's better to do small but predictable gains. Being greedy is usually not a good advisor.
Great comment!!! Cheers😀
I think price will fall
Congrats on being right😄
Ethereum gonna take a dumper
You right!😃
I wanna buy it at $10 LOL
Haha🤣
Good analysis.
Thanks....with eth though, I see the eth/BTC rate these days as something that should be much less significant (compared to eth/usd).
However currently, ETH is tracking BTC so closely, it's weird!
My God!! I never do so much of analysis. What is do is buy low, PRAY and sell high..haha. I think i need to take some technical classes from you..
Haha..love your comment😄
But technical analysis can only take you so far... for example bolligner bands are great at predicting a break up / break down. But if you ask me if we are going to go up or down right now, I am very unclear about it. So probably I will take a safety first approach right now: logic tells me to wait until the 12 hour EMAs switch back to positive....or for example the 3-day MACD goes green (although that's a bit random!)😀
But yeah, EMAs are the best thing to fall back to if you are unsure imo. MACD Is better if you have an instinct for what you think will happen next as you can get the signal earlier, typically - but there's more room for the signal to be wrong imo.
But of course, a great alternative to trading is just buy-and-hold, or dollar cost averaging. Personally, I don't plan on trading steem any more.... it's a buy and hold investment (steem power), and I'll be going down with the ship if that's what happens!🤣
That is really a great piece of advice. Just started with crypos 4-5 months back. I think it's high time for me to learn technical analysis. BDW are you available on steem.chat?
Will be very soon hopefully...just been too busy right now to try it!
Good luck!
Thanks @xaero1 .Hope to see you soon on steem chat so that i can get some trading tips ..haha.
Cool @xaero1
![image](https://steemitimages.com/640x0/https://img.esteem.ws/4y1kr9foef.jpg)
I love superhero movies (iron man, x-men, etc)😆
Means we are the same :D
But I prefer the same cat women :D @xaero1