The crypto market suffered from a retracement in the past 7 days. Traders who rushed into buying cryptos when they saw the previous rise are somewhat in the red. Despite this red week, Ethereum presents a strong buying opportunity. Traders rush to take advantage of such technical formation, as this presents a highly probable winning trade. In this article, we’re going to lay down an Ethereum Price Prediction and talk about 3 reasons why Ether is a strong buy.
#3 Ether is STILL on an UPTREND
This might come as a shocker, but Ether’s price is still on an uptrend despite the recent price adjustment. In fact, Looking at the daily chart in figure 1, we can clearly see how prices present the perfect uptrend formation. Higher highs and higher lows occurred repeatedly since mid-July 2021. The recent price adjustment in the crypto market is nothing but a mere retracement back to the psychological area, which lies around the USD 4,000 mark.
#2 Ether retraced EXACTLY as planned
If we plot the Fibonacci retracement to the current uptrend, we can see how prices retraced back towards the 38.2% area. This price of around USD 4,050 is the first line of support for prices. Many technical traders will be looking to place buy orders around this price.
Why is the 38.2% retracement level important you might ask? Great question. Fibonacci levels are always looked at by technical analysts to assess the expected behavior of a trend. This helps in anticipating a trend reversal, consolidation, or continuation of an existing trend. In an uptrend, the 38.2% Fib level is the first line of defense for the uptrend. If broken lower, traders will expect either a short-term consolidation or a trend reversal. For Ether’s current case, prices are sitting just around that area, and this presents a good buying opportunity.
#1 Ether is at a Strong Psychological Price Area
It is no surprise that psychological prices affect traders and investors. Bitcoin prices were broadcasted by the mainstream media by announcing BTC psychological prices, such as 5K, 10K, 20K, 30K, 40K, 50K, 60K, 100K…For other altcoins, the same thing occurs when traders talk about important price areas. Ether’s current price just retraced towards the strong Fib support and a psychological price of USD 4,000. Buyers should be entering the market, and prices should continue higher.
It is never “too late” to enter the market and buy Ethereum. On the other hand, traders should always do proper risk management techniques, in order to know what’s their downside in case the market turns against them. Ether is a good buying opportunity today. This trade setup may fail though, so setting adequate stop-loss areas are always favored in these situations, especially as Ether is around its ATH price of USD 4,860.
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* This article was originally published here