Short on ETH with the boys from $199.5, It’s now or never for this correction

By Tsunami On Apr 27, 2020

Just 3 hours ago as of the time of this article’s writing, ETH traded as high as $200, which meant that it had gained more than 120% from the lows of March. This has been a stunning rally that has convinced many investors to flip bullish on the leading altcoin.

However, analysts are starting to see signs of an imminent reversal for ETH, citing a junction of bearish technical analysis factors suggestive of downside.

Ethereum’s technical outlook isn’t looking too good

According to a cryptocurrency trader with the moniker of “Credible Crypto,” it is “now or never” for a correction in the Ethereum price.

Short on $ETH with the boys from $199.5. Before and after. Note the triple bearish div that came to fruition on RSI. Played out perfectly. It’s now or never for this correction. pic.twitter.com/WibGll2g2L

— Credible Crypto (@CredibleCrypto) April 26, 2020

Backing this assertion, he pointed to the below chart, which shows ETH’s price action over the past few days. It’s a chart that indicates Ethereum bulls are exhausted for the following reasons:

ETH has just broken below an ascending wedge, a classic textbook pattern that generally resolves lower
The cryptocurrency was rejected at the “daily supply” level at $200
And, a bearish divergence has formed between the relative strength index (RSI) and Ethereum’s price.

This comes shortly after Cold Blooded Shiller, a pseudonymous trader, explained that the chart that “caught each major top and bottom” since 2020 began — marking the $290 yearly highs and the $90 lows that were experienced on “Black Thursday” — suggests a top is now forming:

“This ETH chart has caught each major top and bottom. It’s calling for the same in this region. When the time comes I won’t ignore the confirmation.”

All eyes on Bitcoin

It’s important that investors keep an eye on Bitcoin, though, as a rally in the leading cryptocurrency could negate any serious downturn in the altcoin market.

Unfortunately for bulls, BTC is showing signs it may reverse here.

Per previous reports from AZCoin News, trader “Cantering Clark” remarked on April 24th that BTC’s inability to rally further from $7,500 past $7,800 is “not the type of response I would want,” referencing how the price action that transpired on Friday and Saturday and is transpiring today on Sunday is anything but bullish.

Contextually these levels that $BTC took are pretty important from a HTF R:R standpoint but I am not seeing the type of response I would want.

Either I am wrong about where the market thinks the line in the sand is or this is a sign of exhaustion through the high. pic.twitter.com/6NLIYJEvB9

— Cantering Clark (@CanteringClark) April 25, 2020

He went as far as to say that from how he sees it, BTC’s failure to hold above $7,520, which he pointed to as a crucial level on a medium-term time frame, is a sign of exhaustion for bulls after the 100% rally.

Furthermore, a pseudonymous trader noted that both Bitcoin and Ethereum have printed a four-day TD Sequential “9” candle. TD Sequential “9” candles are often seen near or at reversals in trends.

Not only would this be a textbook sell signal, but a four-day “9” candle is also what predicted Bitcoin’s previous medium-term high in February at $1o,500. As the trader who spotted this signal fittingly put it, it’s a “perfect sell setup.”

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Source : Bitcoinist