( DAILY) Bitcoin [BTC] forming a bullish pennant!

Over the past week, ETH-USD markets have seen a steady bleed as prices have slumped lower and lower. Any buy-back volume the markets managed to see was gradually eroded as the overall trend headed downward:

Figure 1: ETH-USD, 4HR Candles, Gemini, Descending Trendline

As predicted in last week’s ETH-USD analysis, a failure to see any significant increase in buy volume led the market to see further tests of the Fibonacci Retracement values. At the time of this article, the market is rejecting the neckline of the previous Double Bottom Reversal (shown in yellow and noted at the 61% retracement values) and has moved on to retest the 50% retracement:

Figure 2: ETH-USD, 1HR Candles, GDAX, Fibonacci Retracement Values

Multiple tests of the 50% and 61% values are very common in both downward and upward trends and can sometimes provide great opportunities for short-term market trades due to the predictable support and resistance values. Today’s rejection of the 61% line is not entirely surprising; a lot of volume entered the market upon the arrival of the Double Bottom Reversal from last week, marking a potential turnaround from a strong bear market to a short-lived bull market. Ultimately, after failing to retrace the downtrend of the previous bear market, the bullish trend subsided and continued its way toward lower values.

In the coming days, don’t expect to see any strong upward movement from ETH-USD markets without a test of lower values. As we continue to test the Fibonacci Retracement values, we can expect to see some turbulence surrounding another test of the 50% and ultimately a test of the 61% values. If we manage to slide below the 61% line, there isn’t much in terms of support before the market reaches the lower $200s. A drop below the 61% line could lead to another slip of $50 as the market will ultimately try to find its next line of support.

Summary:

1. The ETH-USD price has seen a slow descending trend as multiple tests of the established Fibonacci Retracement values have continued.

2. If ETH-USD drops below the 61% Fibonacci Retracement values, a pullback to the $200s is most likely — this is a significant level of support below the $250s.

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