Veteran trader Peter Brandt is issuing a warning to Ethereum traders as the leading smart contract platform fights to stay above $3,000.
Brandt tells his 566,000 Twitter followers that he sees a large bearish pattern forming on Ethereum (ETH).
“I am NOT saying I believe it and I am saying I am not shorting it – but like it or not if you own ETH you will have to deal with it.
This possible H and S [head and shoulders] exists. Whether it is completed, fails or morphs, it exists. I am NOT a hater.”
A “head and shoulders” formation is a technical analysis pattern that many traders view as a signal that an asset’s uptrend could reverse and a bear trend may be on the horizon.
According to Brandt, a technical breakdown could devalue Ethereum by over 26% from its current price of $3,077.
“I am NOT predicting the end of the world. Even if the H and S works (a BIG IF) the log target is $2,276.”
Fellow analyst and trader Smart Contracter, who nailed the latest Ethereum dip, believes that the pullback is over and that Ethereum is poised to rally to a new all-time high at $5,200.
“Alright, I’m closing this thread off now. [I] didn’t quite get as low as I wanted, but leaning more towards that ABC being done and the bottom now being in.”
The trader uses the Elliott Wave theory, a technical analysis approach that predicts price action by following crowd psychology, which manifests in waves.
According to this theory, an ABC wave is a corrective move in a bull cycle, as seen above. Once resolved, the asset usually resumes its uptrend.
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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/Preechar Bowonkitwanchai
