Since the high point at $4,113 on March 13, Ethereum has been undergoing a correction, which, although painful, has followed a classic ABC correction pattern. Currently, we are at a crucial juncture: either transitioning into the next impulsive upward movement or still within the final stages of the correction.
ABC Correction Breakdown
The ABC correction is a standard market structure, often signaling a pause before the next move in the dominant trend. As visible on the chart, Ethereum has been following this pattern closely. However, there remains the possibility of another low being formed, as Wave C — typically composed of five sub-waves — has not yet fully completed. This leaves room for further downside before a new upward trend can take hold.
Key Resistance and Support Levels
We have identified a key resistance/support line on the chart, which will be critical in determining Ethereum’s next move. Should Ethereum successfully reclaim this level, it would strongly suggest that we are entering the next impulsive wave upwards. This is crucial because, according to Elliott Wave principles, Wave 4 should never breach the price range of Wave 1. If this happens, it would invalidate our current primary scenario, which currently holds a 60% probability.
Summary
Ethereum is in a delicate position within this low-time-frame structure, balancing between the final stages of correction and the potential for a new impulsive rally. The upcoming price action around the identified support/resistance line will provide clarity. A successful reclaim would confirm the start of the next impulsive move, while failure to hold could mean further downside within the ongoing correction.
Traders should watch closely for confirmations in price action before making any significant moves.
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