Ethereum (ETH) has run into an important trend line resistance at a time when everyone is hoping for the beginning of a new bullish cycle. This trend line has previously seen the price begin a major downtrend after rejection. We can also see on the weekly chart for ETH/USD that this trend line was an important support when it was broken in 2018 and Ethereum then formally entered a bear market. This trend line is what stands between Ethereum (ETH) and the next potential uptrend. However, please be advised that the market makers and the whales would try their best to mislead retail traders near-term. So, until and unless there is follow through, it is not worth the risk reward to be chasing the price here.
The fib time zone on the weekly time frame also spells trouble for ETH/USD because if the price fails to break higher in the days ahead, then it will have to decline much lower to potentially form a new low. There is a very strong probability of ETH/USD declining down to $50 or lower during the next downtrend. If we look at the weekly chart, we can see how the price did the exact same thing as it has done now in 2018 just before the beginning of a brutal downtrend. The big players in this market keep playing these games to trap retail traders and they will continue to do it as long as people fall for them which they always will. We also have an important horizontal resistance around $272. I may have called the top around $277 recently on Tradingview but I would still be very careful because anything could happen near-term.
When the stakes are this high, no fair play is to be expected. We all saw what happened recently with Ripple (XRP). The rest of the market also saw some naked manipulation recently. It is important to realize that regulatory bodies like the SEC will come knocking at some point. It could be anytime now. Most of such events line up based on what is happening on larger financial markets. This is why we will continue to see more hacks and interruptions during bad times, not good times. Ethereum (ETH) has recently spiked up against Bitcoin (BTC) but it has now run into a strong resistance as seen on the ETH/BTC weekly chart.
The market seems primed for a sharp correction. Altcoins are going to be in a lot more trouble compared to Bitcoin (BTC). What happened with IOTA is a good example of what could happen with a lot of the other useless altcoins. The problem here is that 2017 sparked an altcoin FOMO and that was not just for traders or investors. Developers that were looking to launch different projects rushed them most of the time with half baked products because they did not want to miss the buying frenzy. They wanted traders and investors to buy their tokens while everyone was bullish. Same was the case with the Tezos ICO. They had to issue a warning that they don’t know how to recover customers’ funds in case they are lost. The bottom line is, things are going to get worse before they get better. We are a long way from the next bullish cycle just yet.