Ethereum tried to rally but fell a bit on Tuesday, initially rallying up to the $1,600 level before getting rejected, closing the daily candle around the 50% Fibonacci retracement at $1,540. This isn't a terrible candle as it looks like ETH is trying to reach higher but buy/sell sentiment is still pretty flat.
(March 2, 2020 7:30 PM EST)
Short-Term:
Ethereum's failed rally today showed a flash of life that was ultimately pushed down by sellers around the 50% fib. This isn't necessarily bearish and ETH printed its highest candle in almost a week before giving back the gains and forming a higher low vs yesterday's early dip. The 61.8% fib level and the 50 Day EMA appears to be quite supportive for ETH as ETH has bounced a couple of times now around this region. It looks like ETH is trying to form a rounded-bottoming pattern in which it slowly grinds back higher in a 'U'-shaped pattern. If ETH can grind sideways and break above the $1,600 level, then ETH may be ready to return to the new ATH just above the $2,000 level.
Long-Term:
ETH is currently finding support at a confluence of supportive levels: 61.8% retracement, previous major resistance level (now support), and 50 Week EMA on ETH/BTC chart. This is a classic crypto 30% bull market correction in which ETH is reverting to the mean and testing support, printing a higher low. This is good and frankly healthy for ETH as we want this bull market to be sustainable and consistently rise over time. Bull markets are not linear lines that go straight up to the cycle peak; there are peaks and valleys, and this is a valley. With that being said, I'm a buyer on this dip as we are in a bull market and this dip is a fantastic value add at 30% off the current ATHs. ETH is projected to outperform its 2020 performance, which was 450%. Accordingly, this equals a $3,000+ ETH by EOY 2021, and if you look at my longer-term chart from last week's ETH article, you'll see my projected W3 extends above $5K (again - not the cycle top).
ETH/BTC:
ETH continues to hover just above 0.03 ETH/BTC as it has absolutely bled in satoshis since printing a local top around February 8th. ETH appears to be finding some support around the 0.03 which is met by the 200 Day EMA. If ETH can put in a bottom at this level, which it appears to be trying to do, then that would be a higher low and we can start ramping up accumulation.
Historically, the ETH/BTC ratio tends to range between 0.04 and 0.08 and typically peaks around 0.1 ETH/BTC at the tail-end of crypto bull markets, so 0.03 is near the bottom and excellent value in the medium-longer term of this cycle.
From my perspective, all signs indicate it's probably wise to buy ETH or earn ETH now before prices continue to ascend in dramatic throughout the rest of 2021 and further. Buying ETH under $2,000 is like buying Bitcoin under $30K; not much higher than the previous ATH, and not likely to last much longer.
Support:
$1,400, then $1,300, then 78.6% fib at $1,259. 0.03 ETH/BTC is critical.
Resistance:
2,000, then $2,500, then $3,000.
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