Top Down Analysis Of ETHUSDT Using Support And Resistance Strategy And RSI Indicator As Confluence

Source

Hello great minds,

It is a great opportunity to come before you all today to share my technical analysis on eth against usdt.

I believe you are all doing perfectly well and are enjoying your activities in the community as you actively promote steemit across various social media platform.

Ethereum is a very big cryptocurrency in the cryptospace and we are well aware of this.

Ethereum happens to be the second most biggest and popular cryptocurrency in the cryptospace.

After Bitcoin which is the driver of all other tokens, ethereum is known to be the next most valuable token, and I am here to share my analysis to it.

---

---

ANALYSIS USING SUPPORT AND RESISTANCE STRATEGY

---

---

I begin my technical analysis from the higher timeframe, then I descend to the lower timeframe

On the higher timeframe, ideally the monthly timeframe, I seek to determine market trend

The monthly timeframe helps to eliminate market noise from the market and also compress the market to one screen.

And from this, it becomes very easy for the market trend to be predicted.

The screenshot above is that of the pair ethusdt on the monthly timeframe.

And as seen above, there are lesser candles on this timeframe and this is as a result of the time it takes for one of this candles to be formed.

On the monthly timeframe, it takes the time period of 1month for each candle to be formed.

And also, it is easy for the overall trend of the market to be detected on this timeframe, as we can see that the market is being bearish.

I then continued my analysis by moving to the weekly timeframe and on this timeframe I could see the market more clearly, I could see the formation of more candles as each candle here is being formed within the trading period of 7days.

And looking carefully, I was able to identify a key level and this level is functioning as a resistance level to the price chart as the market is expected to be rejected whenever it trades towards this level.

And looking carefully, I realised that this level has been tested and respected severally by the market which shows the validity of this level.

I then decided to move to the daily timeframe for more market activities, and looking carefully, I could see series of bearish and bullish candles which indicates the presence of the buyers and sellers in the market.

And looking carefully, I was able to identify another key level and this level can be said to be acting as a support level to the price chart, and the market is expected to be rejected whenever it trades towards this level.

And looking carefully, I noticed that this support level is a valid level as it has been severally tested and respected by the market, from the above screenshot, we can see the market making multiple touches on this level.

And moving to the 4hr timeframe I could see series of market candles which indicates the presence of the buyers and sellers as they struggle to drive the market to their preferred direction.

And looking carefully, I realised that the market is in a bearish phase, as it forms series of lower lows and lower highs until it trades towards its support level.

And when it traded towards its support level, I could see bullish rejection from this level and this gave me a bullish bias on the market.

And getting to the 2hr timeframe with my bullish bias of the market, I searched for bullish entries into the market.

And then I was able to identify a bullish order block which is most likely expected to be respected by the market, and before entering the trade, I decided to search for trading confluence using the relative strength index indicator.

---

---

CONFLUENCE USING RELATIVE STRENGTH INDEX INDICATOR

---

---

The relative strength index indicator is an indicator that helps to identify overbought and oversold market.

When a market is spotted to be overbought, it is a bearish trend reversal signal and when it is oversold, it is a bullish trend reversal signal.

An overbought market can be spotted when the rsi crosses above the 80% line and an oversold market is detected when the market crosses below the 20% line.

Applying the rsi to the monthly timeframe, I could see that the market is being oversold and an oversold market signals a bullish trend reversal.

An oversold market can be detected when the rsi crosses below its 20% line and this is what is said that happened in the above screenshot.

And moving to the daily timeframe, I could also see that the market is being oversold and an oversold market is understood to be a market condition that shows the weakness of the bears and the strength of the bulls

And as such, I decided to move to the 2hr timeframe in search of entry into the market.

And moving to the 2hr timeframe with my bullish bias of the market, I then decided to place my entry on the bullish order block in the market.

And my take profit position was placed on the closest resistance level to the market price.

---

---

CONCLUSION

---

---

I have shared my analysis on ethusdt beginning from the monthly to the weekly to the daily and to the hourly.

From my analysis, I expect to see a bullish move on ethusdt.