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ETH/USD crypto signal - A short term sell - 14 Apr 2018

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The cryptocurrency markets last week showed some signs of a rebound after prices fell sharply since the past few months. While analysts continue to find reasons for the rebound across Bitcoin and Ethereum, the fact remains that prices of cryptocurrencies are set to post a modest comeback.

One of the commonly held views is that the selloff in the cryptocurrency markets came as a result of the tax season. However, we disagree as the decline in cryptocurrencies started earlier in January. A simple explanation has been the fact that given the attention cryptocurrencies received, there was a lot of retail buying especially as Bitcoin and Ethereum touched fresh highs.

This eventually led the bubble to pop as prices fell sharply in the days after the cryptocurrencies posted new highs. Adding to the decline was also a string of bad news in terms of regulations and clampdowns across the world on cryptocurrency trading.

As noted in our previous commentary, Ethereum prices managed to rally above the $400 level. Although price had briefly slipped below this level, the recovery managed to push Ethereum prices to highs above the $500 mark. We continue to maintain a short term bullish view on the cryptocurrencies.

In the near term, Ethereum prices are likely to post a modest correction. We expect that ETH will slip back to the $461 - $460 level where support could be established. A rebound off this level, which is likely to happen this week could potentially validate the upside bias.

There is however a risk of Ethereum prices slipping further to the $417 level which we find to be a more appropriate correction in the rally. The decline toward $417 would suggest a retest of the previously held resistance level which will turn to support.

A rebound off the $417 region could signal another leg in the rally targeting $461 and $500 before ETH prices eventually test the $700 level.

For short term, the cryptocurrency trading signal is to sell ETH at $485 with stops at $520. To the downside, ETH will be targeting $460 followed by a move lower to $420.

crypto signal ethusd 14 apr 2018

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion. All risks and coasts associated with online trading are your responsibility.