It’s a story that I’ve told day after a day it seems. When you look at this kind of instrument day to day, you sometimes lose the big picture. For example, the fact that Bitcoin has risen almost %100 over the last 30 days. Ethereum though continues to be a laggard, which is odd.

1. This Bollinger Squeeze can be a good beginning to analyze the average length of time Ethereum likes to consolidate before moving again. We did get a nice jump up in Ethereum when Bitcoin was breaking away from the 6,7,8 and 9k areas. Since then, we have been fairly range bound.

2. Our oscillator continues to show some downward movement, but we are not yet in an oversold area.

3. This is an important area. The two dark horizontal lines represent two very important and natural support and resistance areas. If the levels I drew are correct, then we should see rarely see breaks that are easy. These lines are going to the hardest to break above or below. Additionally, the thin horizontal line is the midpoint. That line is going to second hardest to break above or below. Price so far has been respecting that line.

4. One of Gann’s time cycles is an 11-day cycle that starts from an important swing high or swing low. There are a number of cycles that Gann used to measure time and it is common for one to be more sensitive than the others. I am currently using the 11-day cycle to do a time cycle analysis of how Ethereum responds to time. The future 11th day is plotted ahead on the chart.

What to look for

  • A good short opportunity would be any close on the hourly that is below the midline.
  • Keep an eye on the oscillator as it approaches or enters the oversold area. If price continues to linger just above or below the mid and the oscillator is oversold, a buy opportunity has presented itself.
  • As price approaches the 11-day cycle ahead, look to see where price and the oscillator are located. For example, if price is a the lower thick horizontal line and the oscillator is oversold, then a buy opportunity has presented itself.
  • We want to observe any strong and powerful move to the upside that moves beyond our upper resistance line. It is entirely possible that any selloff or weakness in Bitcoin could have an inverse action here in Ethereum.