Ethereum, H1 time frame:
Ethereum continued to rise in the hourly chart yesterday. However, it met the resistance level of 1812.43, which it was unable to break through twice. Thus, a downward correction will now be possible. Until the resistance level is overcome, it is not worth counting on a new strengthening of the cryptocurrency. But fortunately, the upward trend of the two most popular cryptocurrencies persist. There are two ascending trend lines at once and so, we are only expecting a correction. In the previous review, it was recommended to continue buying Ethereum if the level of 1757.81 is broken through. This level was exceeded twice, so each time, traders could open purchases that allowed them to earn 4,000 points of profit. However, a clear rebound from the level of 1757.81 did not happen, so short positions should not have been opened yesterday.
Ethereum, M15 time frame:
Both linear regression channels are inclined upwards in the M15 time frame, signaling a short-term upward trend. However, the cryptocurrency failed to break through the level of 1812.43 two times in a row and it is very evident in the chart that the price has never formed a “false breakout”, as it was unable to keep its position above this level for more or less an hour. Thus, we are directed again to a possible correction to the critical Kijun-sen line.
The price of the second leading cryptocurrency continues to ascend, just like the whole cryptocurrency market. One way or another, Bitcoin pulls other cryptocurrencies with it. In addition to Elon Musk’s tweets and Tesla’s report, which decided to invest in Bitcoin, Ethereum has its own positive news. This cryptocurrency gained access to the Chicago Mercantile Exchange on Monday, February 8. Thus, its recent growth is clearly reasonable. But at the same time, this cryptocurrency cannot still be called low-volatile. It was already mentioned a few times that almost any cryptocurrency is an extremely volatile instrument. This is proven by the data on the losses to traders of their deposits in trading in Bitcoin and Ethereum yesterday. For example, traders who opened sell transactions on Bitcoin lost around $ 1.2 billion, while with Ethereum, sellers lost 147 million dollars. Thus, we continue to warn traders that it is not difficult to lose their deposits when it comes to trading cryptocurrencies. However, if one clearly adheres to the strategy, do not try to guess the reversals and trade strictly according to the trend, then it can earn a lot. For example, many cryptanalysts now recommend taking profits on long positions, as growth already looks excessive. However, this does not mean that the Ethereum and Bitcoin cryptocurrencies should be sold. The growth of both can continue for some time, but the main point of this advice is not to take risk for nothing.
Thus, when opening long positions, it is necessary to note risk management and protective Stop Loss orders in case of a sharp price downward reversal. Many crypto experts also note the strong dependence of altcoins on bitcoin. Therefore, an excessively overheated bitcoin may begin to decline in the near future and pull other cryptocurrencies down with it.
In any case, there are two trading ideas for February 10:
1) Buyers took the lead again, pushing Ethereum towards new peaks. Thus, it is recommended to buy it if it successfully breaks through the resistance level of $ 1812.43, with the target set at $ 2029.00. In this case, Take Profit can be up to 18000 points. It is also possible to buy it with targets of $ 1,757.81 and $ 1,812.43 if the price rebounds from the Kijun-sen line ($ 1,652.00) or the level of 1,694.83.
2) Bears have recently corrected the cryptocurrency, but it is still lacking. Today, another correction is likely again. But given the strength of the upward trend, it is recommended to trade below, with targets set at the level of $ 1557.33 and the Senkou Span B line ($ 1513.00), if the price consolidates below the Kijun-sen line ($ 1657.00). Here, Take Profit can take up to 11000 points.
Explanations for illustrations:
Price levels of support and resistance (resistance/support) – levels that are targets when opening purchases or sales. It is possible to place Take Profit levels near these levels.
The Kijun-sen and Senkou Span B lines are the Ichimoku indicator lines transferred to the H1 and H4 time frame.
Support and resistance areas – areas where the price has repeatedly rebounded.
Yellow lines – trend lines, trend channels and any other technical patterns.
The material has been provided by InstaForex Company – www.instaforex.com
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