If anything, I’m expecting ETC prices to be free this week. By that I mean, chances of a blast above $41 is on the cards and maybe you should ask why. We can begin by talking about this slow price activity thus far.
ETC prices have been chocked within a $20 range and that can be the much needed accumulation that was missing. Maybe bulls are padding up ready to build up enough shock absorbers as it prepares to break and close above this immediate resistance.
Momentum wise, look at how this week’s candlestick looks like. Don’t miss that long lower wick that equates to buy pressure and then secondly, the way it looks like its aligning itself along the upper BB.
All these signals and its proximity to main support at $25 are convincing enough that the break out trade is still at its early stages. Obviously, as it is there is more room for the upside in the lower time frames where we recommend taking longs only.
Besides the main support at $25, another support line worth looking is the 20 period MA.
From early November when the ride begun, the middle BB has been a reliable support until after that dip on December 22 but prices managed to wriggle back above it as the chart shows.
If today ETC prices continue to chart up towards $41, then the better because we need price action to shift away as far as possible from the middle BB so that ETC prices build enough momentum.
As expected, prices are moving according to plan in our entry chart. From the look of things, prices are reversing from the 38.2% Fibonacci retracement level at $33 and that coincidentally was our previous resistance line now support.
By the mere fact that buyers jumped in at 38.2% means the momentum is high just like the weekly candlestick-the long lower wick-hints of. As we have marked out, resistance is at $41 but more meat is found at $49, the first Fibonacci extension level anchored on last week’s high lows. That is where short term traders should be aiming at but overly, targets is at $65.