Here’s How High Ethereum Could Go as It Hits Record Highs – TheStreet
Ethereum has been on fire, rallying more than 44% in the last nine days with the cryptocurrency registered a gain in each of those sessions.
While there’s been some volatility in the cryptocurrency markets, ethereum has been as steady as they come.
In fact, it’s been much steadier than the largest cryptocurrency, bitcoin. While bitcoin has been trading better lately, it’s struggling on Monday, up about 2% but well off the highs.
That’s even as CME Group (CME) – Get Report launches new micro bitcoin futures. It’s also as Coinbase (COIN) – Get Report tries to find its footing and as eBay (EBAY) – Get Report says it’s open to potentially accepting cryptocurrency payments.
For ethereum’s part though, the cryptocurrency is at its session highs and up about 10% so far on the day. That’s vastly better than its other cryptocurrency counterparts.
Let’s see how far it can rally from here.
Chart courtesy of TrendSpider.com
When we zoom out with a weekly chart, investors can see how powerful of a rally ethereum has been enjoying. While other cryptocurrencies are looking for stability, ether bulls are looking to put the pedal to the metal.
So far, they are. After being rejected by the $2,500 level in back-to-back sessions, ethereum ripped through this level on Sunday and is extending over $3,000 on Monday.
In fact, shares rallied right through the two-times range extension at $2,765 with seemingly no effort at all.
From here, I want to see if it can rally to the 261.8% extension, up at $3,594.
Obviously, that would leave the cryptocurrency in an overbought state. However, that doesn’t mean it can’t get there. If momentum remains strong enough, $4,000 may even be in the cards.
When it comes to the downside and/or a correction, I will be watching for a few things. First, I will be looking for divergence on the RSI or Williams %R measures, while ethereum is hitting new highs.
I will also be looking for some type of reversal candle. As in, a push to new highs, followed by a move lower in the same session. That could point to short-term exhaustion, sort of like what we saw with bitcoin on the day Coinbase began trading.
From there, we would need a rotation lower to confirm the move lower.
Lastly, a move below $3,000 could put the two-times range extension back in play. Below both measures could put the 10-week moving average and/or $2,500 level in play.
For now though, the momentum very much resides with the bulls.
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