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ETH · 5w

Ethereum: The Run to $9000 Was Delayed. Get Ready for the Next Try

Three weeks ago, see here, I showed a potential Bullish Elliott Wave Principle (EWP) path for Ethereum (ETH), “if ETH can rally above the $2920 high made last week, without dropping below Sunday’s low first ($2275) and especially not below $1736“.

Well, that rally over $2920 did not happen as the cryptocurrency stalled at $2890 on June 3 and subsequently dropped below $1736 two days ago. Thus the Bullish potential setup was negated. Does this mean the run to $9000 will not happen anymore? No, my work strongly suggests a bottom is much closer now. Let me explain.

Figure 1A below shows the monthly candlestick chart for ETH; as you can see, it has lost over 60% since last month’s all-time high (ATH). In addition, it did a 62% retrace of the rally that started in March last year. If we go back to 2017, we see ETH also lost over 60% of its value during the summer, which was also a 62% retrace. It then staged an almost 1000% rally. Thus, historically the current decline is still nothing out of the ordinary.

Zooming in, the weekly candlestick chart in Figure 1B shows ETH has so far only moved down in three EWP-waves from its ATH into this week’s low: red waves a, b, c. Corrections always move in at least three EWP waves.

Thus, based on the historical evidence and the EWP count, the current decline must still be viewed as a correction in a significant long-term uptrend until proven otherwise.

Figure 1. ETH monthly and weekly charts with EWP count and technical indicators.

Short-term, there is still downside risk, but also even more upside potential longer-term

The devil is always in the details, so allow me to zoom into the daily time frame. See Figure 2 below. It follows ETH should be in red wave-c of black wave-4. C-waves are mostly comprised of five smaller waves. In this case, green 1, 2, 3, 4, and 5. Green wave-3 reached the ideal target zone, and ETH bounced back to the ideal green wave-4 target zone. If all goes to...

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