Barely 3 days in and ETC is rallying. In the weekly chart, we can deduce observe several technical set ups that can form the foundation of a possible ETC rally in the next few weeks. To start with, last week capital injection pumped $11 into this alt coin. Sometimes last week, ETC was almost double its current valuation after touching highs of $23. After the buy euphoria waned, USD bulls brought this coin back to back to $14. Most importantly, it closed above the 20 period MA.
Secondly, notice the stochastic buy signal turning from overbought territory. Obviously, there is strong buy momentum because of those diverging %k and %d. Furthermore, price action is charting higher as we can see with this week’s bullish candlestick already above the main resistance trend line at $17. So far, ETC is up $7 after appreciating from lows of $12 recorded earlier this week.
To determine the intermediate term trend, we have to analyze price behavior in the daily chart. Here we can see that price action is confined within a $10 range marked by that triple tops resistance at around $24 and support at $13. It is at this support level where recent prices bounced from on November 13 after the necessary correction when ETC price action closed above the upper BB. On November 3, there was a strong bullish break out above the main resistance line. This was expected given the bull divergence between September 15 and November 3 when prices were almost horizontal.
Based on these technical set ups in the higher time frames, we recommend taking long positions only. There is a stochastics buy signal in the 4HR chart but current entry prices aren’t the best. Ideal buy triggers would have been after the formation of that bear pin bar with stochastic buy signals in place. Right now, we shall set a buy limit between $12 and $15 support and resistance levels defined last week. From candlestick characteristics, USD bulls are pushing prices lower as shown by that long upper wick in this current candlestick. Only initiate a long trade when there is a stochastic buy signal and a confirming bull candlestick printed.