Ethereum exploded higher on Monday (particularly the beginning of Asia trading) as ETH broke out late in the weekend, rallying 30%+ overnight to eclipse the $1,000 level. ETH reached up to about $1,150 before pulling back, eventually settling the day around the all-important $1,000 inflection price level. This is a large and extremely powerful bullish engulfing candle showing ETH's breakout above the ascending channel and into the four-figures for the first time since mid-2018.
(January 4, 2020 8:30 PM EST)
Ethereum is back, baby! This is the breakout we've been waiting; a slingshot higher as the ETH/BTC ratio bounced nicely off the 0.025 level and is now sitting comfortably around 0.033, forming a nice bottom and starting its slow ascension against King [Bit]Corn. This breaks the downtrend on the daily chart and shows a breakout above the descending 50 and 200 Day EMAs, now sitting well above both. If ETH corrects down to the 0.03 level amid another Bitcoin breakout and finds support there, we should continue to see ETH grind higher in Bitcoin's tow. Bitcoin is and will likely continue to lead crypto as the largest cap and foremost asset in the ecosystem, yet ETH is firmly entrenched as the No. 2 crypto with all other alts competing for third.
I'm extremely bullish on ETH as many retail investors are already finding themselves priced out of Bitcoin. That leads them to the next best crypto: Ethereum, which is much more reasonably priced for someone with a stimulus check or Christmas money to spend. I think there's no doubt that there will be another altseason later in the bull market as it usually transpires, though ETH has solidified itself at this point as the de facto No. 2 crypto by market cap, price, utility, and safety of investment.
I think the best strategy here is to buy the dips and even earn ETH wherever possible. Otherwise, DCA is the way to go and possibly store some dry powder for another 'larger' dip if we're lucky enough to get one in Q1 2021. I think 2021 will be substantially better for 2021, although ETH has outperformed BTC in 2020 so really it's no surprise there.
Support: Support can be easily surmised at $700 which is now 30% lower and distantly in the rear-view mirror. Above that, look for support around $800 which is simply a large round number which may meet with the rapidly upturning 50 Day EMA. More importantly, however, I think now is the time to watch the ETH/BTC ratio for support instead of the USD pairing. The USD pairing is not the sole factor in terms of support and resistance; in fact, 0.03 could be a critical support level which may equate to an arbitrary US Dollar price level.
Resistance: If ETH can hold onto $1,000 and grind higher, ETH should continue higher and then we can start talking about new ATH's, as I doubt there's much resistance between $1,000 and $1,400. Holding $1,000 and then targeting $1,200 are my immediate-term points of interest.
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