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Ethereum’s Constantinople hard fork has certainly created hype and motivated traders to establish a short-term bottom. The thing to watch to out for is how high Ethereum moves before the whales can start dumping again.

Technical Analysis

Chart 1

If the bullish trend continues, there will be multiple resistance levels in the coming days. These include Resistance 1 @ 0.0415, Resistance 2 @ 0.048, Resistance 3 @ 0.054 and Resistance 4 @0.058.

Chart 2

Fibonacci retracement ratios drawn from the all-time high show that the price level at around 0.055 BTC will be a major resistance and this is the price where short-term/swing traders will likely take profits.

Chart 3

Ethereum may see short-term resistance at the 200 day Simple Moving Average on the daily time frame and therefore may face some correction. On the positive side, the price had no trouble getting above the 100 day SMA. This is bullish as on the USD pair, Ethereum is still facing resistance at the 100 day SMA.

Chart 4

Traders can also keep an eye on the Accumulation/Distribution Index. This index represents the buying vs. selling force. Currently, the Accumulation/Distribution Index is also at a resistance level and a break above the resistance line can be interpreted as a bullish indicator. So, keep an eye on the index.

Chart 5

In the short term, there is bearish divergence seen on the 4-hour time frame trade volume. This suggests that the short-term trend may be slowing a little and we can see some kind retracement to the nearest support levels.

Chart 6

The price may find retracement in the short term as the Elliott wave cycle has almost completed since the Bull Run started in December. The price must not fall below the support zone in order to stay bullish before the hard fork. The current set up will turn bearish if and when the price falls below the 0.031 BTC level.

Verdict: Cautiously Bullish

Comment: Traders who wish to go long should position size and may also wait for a retracement before entering into the trade. Also, keep an eye on the support zone as discussed above and put a stop right below the support zone, around the 0.033 BTC price.

Disclaimer by the Author:

This is not investment advice or promotion to ICO or Cryptocurrencies or any other investment in any form. These views are based on Author’s own research and readers must execute caution & suggested to do their own research during any investments.