ETHUSD: When It's Hard To Argue With The Signs? Long.
Ethereum / Dollar BITFINEX:ETHUSD
ETHUSD update: Beginning of retrace appears to be in progress with BTC making it back to 6500 after a significant low made earlier today. The swing trade criteria has lined up and a long has been triggered at 485 (sent to followers on S.C. earlier).
Even though these markets have been very bearish recently, they do not decline in a straight line. Retraces happen, and when they offer greater potential reward than the cost in terms of risk, a trade can be justified.
This is the situation with this market. In terms of structure, price is in the process of establishing a failed low formation. This is happening while bouncing off the reversal zone boundary of 458. A level that has been in place since May.
On top of that, this retrace is occurring within the 544 to 464 support zone which is the .618 of the recent bullish structure. The trigger developed in the form of a bullish pin bar off the 458 level. When it becomes hard to argue with the signs, it is time to trade.
The rest of the trade details like the stop and target are available on S.C. I chose a conservative target because bearish structure is still in place. The bearish trend line and the 625 resistance level (.382 of current bearish structure) have not been taken out. Until they are, it makes more sense to expect less from the long side.
In summary, we have been writing adamantly about accumulating coins during this time of unjustified negativity. As Andrew wrote in an earlier article on BTC , if you believe in the merit of these technologies for the long run, meaning over years, then there is no reason not to buy extreme weakness.
If this retrace turns out to be strong, that is when everyone who is hesitant to buy now will feel comfortable jumping in. And guess what we will be doing? Locking in profits.
It may feel counter intuitive, to buy markets that have been so weak, but the comfort zone is not your friend. Especially in financial markets. Remember, it's about probability, not profitability. And if the trade stops out, it will still be considered a correct trade since it was within the criteria of our swing trade plan.