- Ethereum price continues to trudge higher, but some selling pressure enters the market.
- Seven-week Gann ‘Death Zone’ time cycle complete, a corrective move likely.
- The downside risk is likely to be limited.
Ethereum price has now completed seven consecutive weeks of the weekly candlesticks closing above their open. In other words, seven straight weeks of green/white weekly candlesticks. That is a record for Ethereum; the previous consecutive bullish weekly candlestick record close was five – between the weeks of May 19th 2017, and June 16th 2017.
Ethereum price could drop 20% as Gann and Ichimoku warn of a big dip coming soon
Ethereum price is primed for a violent and swift mean reversion trade. This is due to a critical time cycle in Gann analysis known as the ‘Death Cycle.’ Gann warned that any instrument trending at a steep angle for seven weeks (forty-nine to fifty-two days) is at risk of a near-immediate corrective move or trend change.
Complimenting Gann’s time cycle analysis is the Ichimoku Kinko Hyo system’s confirmatory price behavior. Ethereum price has extensive gaps between the bodies of the weekly candlesticks and the Tenkan-Sen. Gaps between candlestick bodies and the Tenkan-Sen do not last long and often
resolve in roughly four to six periods.
The projected retracement is the $4,000 value area near the weekly Tenkan-Sen, but Ethereum price could travel lower to the Kijun-Sen at $3,300. While doubtful to occur, if Ethereum faces a capitulation move south, its final support on the weekly chart is at $2,300, where Senkou Span B and the 38.2% Fibonacci retracement reside.
ETH/USD Weekly Ichimoku Chart
An invalidation of the projected retracement south would occur if
Ethereum were to close at a new all-time high.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.