Ethereum (ETH/USD) Analysis October 3, 2017
Ethereum continues to grind sideways overall, as the market seemed settled near the $300 level. I see significant support below at $280, while I see resistance at the $320 level. If we can break above the $320 level, it’s likely that we will continue to reach higher, and perhaps even as far as $400. In the meantime, I think that choppiness will prevail, and that short-term pullbacks might offer opportunities for longer-term traders to think about adding to previous positions. If we break down below the $260 level, the market probably goes down to the $220 level. I think that this market will continue to be rather choppy, as it takes its cues from Bitcoin. If Bitcoin rallies, the rest of the crypto currency sector rallies as well, of course the exact opposite is true also.
Building a position
I think that building a position is probably the smartest thing you can do, adding slowly, and increasing your signs as the market moves in your favor. Shorting this market is probably somewhat difficult, at least not until we break down below the $260 level, so I wouldn’t be interested in doing so. I recognize that short-term back and forth trading can provide a nice opportunity for range bound systems, but quite frankly the longer-term outlook for this market has been higher for some time. I think that the market will go looking for the $400 level given enough time, but it may take a while to get there. Ethereum does tend to grind sideways for a while, and then shoot much higher in a short amount of time. This is why building up a position is so desirable, because it gives you the opportunity to take advantage of those moves when they happen, albeit randomly. Pay attention to the US dollar, if it starts to soften, this market should rally.