Ethereum’s Ichimoku charts show ideal bullish breakouts on faster time frames. Near term-resistance on the daily chart must be breached higher for long term bullish outlook.

Ethereum breaking out on 4-hour and 1-hour charts

The chart above is a multiple time-frame chart setup of Ethereum with the Ichimoku Kinko Hyo system. The daily chart is on the top left, the 4-hour chart on the top right, and the 1-hour chart below. The charts above display two very bullish charts on the 1-hour and 4-hour charts. The 1-hour shows a beautiful and text-book example of what an ideal bullish breakout on an Ichimoku chart looks like. The 1-hour chart shows both price and the Chikou Span are above the cloud. Price is also above both the Tenkan-Sen and the Kijun-Sen with the former above the latter. The future cloud is also bullish with Future Senkou Span A higher than Future Senkou Span B. And in the next few hours, we will observe price responding to one of the most significant trend changing events on an Ichimoku chart: when both the current Senkou Span A and Senkou Span B lines are sloping in the same direction as Future Senkou Span A and Future Senkou Span B.

The 4-hour chart also shows some very bullish levels. The last 4-hour candle just broke out above the cloud, bringing the Chikou Span above both the candlesticks and the Kijun-Sen. The current 4-hour candle remains above the Cloud, but it is displaying a bearish candlestick with clear rejection higher (this will make sense when we look at the daily chart). There remain a few conditions that we would need to see on the 4-hour chart before we could have as bullish a view as we do on the 1-hour. First, while the 4-hour Tenkan-Sen is above the 4-hour Kijun-Sen, both are still inside the Cloud. Ideally, both of those averages would be above the Cloud. Second – and most important – is the Future Cloud: it’s red. Now, even though the Future Cloud is red, we do see some very near term indicators that this will not remain so. The top of the Future Cloud, Future Senkou Span B is flat while the bottom of the Future Cloud, Senkou Span A is sloping up. But the ultimate question here is this: why is the 4-hour chart displaying such a bearish candlestick? We need to look at the daily chart (top-left chart).

The daily chart shows clear signs of congestions and consolidation. Prices have not deviated much from the October 26th, 2019 close of 180.03. For the past nine trading days, Ethereum has continued to trade in a $7 range with the close of the daily candlesticks occurring inside a very thin cloud. The most important resistance on this chart is the top of the Cloud (Senkou Span B). Notice how long and flat Senkou Span B is. A flat Senkou Span B is a sign of strength and difficulty. It should be challenging for Ethereum to cross above this price level. The daily chart’s Senkou Span B is where the 4-hour chart was halted from moving higher. Until Ethereum can move and close above the daily Senkou Span B, we will continue to see Ethereum range in this zone. But that may change very soon because the thinnest part of Ethereum’s daily Cloud occurs between today (November 4th, 2019) and November 11th, 2019. And we should pay very close attention to that November 11th date. November 11th – November 14th of 2018 created one of the single most significant and fastest losses in cryptocurrency history.