As you can see from the hourly chart the RSI is showing oversold conditions which is why In today’s analysis, we are going to see how further will the price potentially drop before this last down move is done.
Looking at the ETH/USD daily chart we can see that the price has fallen below the inside pitchfork support line 2 and the 0 Fibonacci retracement level which served as support but as you can see a consolidative cluster inside off of the triangle formed which is known as a bearish pennant and is a considered as a trend continuation pattern.
Relative Strenght Index indicator is near its lowest levels around 18.5% trending downwards. As you can see I have labeled this as a WXY correction and I believe that the wave Y would end on the next horizontal support level at $153.43 but if it doesn’t hold the next support level I see strong enough to hold the momentum behind the down move is at $111.19 where the pitchfork support line 3 intersects the horizontal support level.
Zooming into the 4-hour chart I have counted the sub waves in order to determine the context of this last corrective structure.
As you can see the primary wave W consists of a WXYWZ, wave X of the same type of a correction but in the opposite direction and now we are seeing the last wave Y has three consecutive WXY of a minor degree that constitutes an intermediate WXY correction.
In order to validate my target levels, I am going to zoom into the hourly chart. I’ve measured the length of the wave W and projected it from the wave X in order to project the first target. As you can see in that way the second horizontal support level should be the ending point of the wave Y. Another way that I have used is the Fibonacci retracement tool. I have adjusted the X wave to being at the 0.5 Fibonacci level and in that way the 0 Fibonacci level finds itself on the first horizontal support level at $153.43.
Looking at the ETH/BTC daily chart we can see that the price has broken out off of the triangle’s support as is heading downwards steeply. Currently, the price found support on the 0 Fibonacci retracement level but judging by the momentum the level isn’t going to hold for much longer.
As you can see the projected wave W length indicates that the 0 Fibonacci level is the ending of the wave Y. but if we include the wick then the projected target is much lower at around 0.016461 Satoshi.
Having in mind what was seen on the ETH/USD chart I believe that the price of Ethereum has only downside potential in the upcoming period, and as nothing looks or gives off a bullish indication my default expectation is the lowest targets possible.