Ethereum, the second largest cryptocurrency in the world and the largest altcoin in terms of market cap, followed Bitcoin’s suit and displayed bullish exhaustion and a possible reversal in trend.

The one-day chart for Ethereum displayed a Head and Shoulder Pattern, indicating a bearish signal for ETH’s price. Peter Brandt, an old school trader, tweeted about the same.

pic.twitter.com/ahm0XixgcO

— Peter Brandt (@PeterLBrandt) June 9, 2019

The Head and Shoulder Pattern is a bearish pattern which indicates the reversal of an uptrend. The confirmation for the same is when the second shoulder closes below the neckline. In ETH’s case, the price is currently testing the neckline.

Source: TradingView

If the price decides to break below the neckline, the downtrend might push the price of Ethereum to the resistance levels of $205 and $180. The total drop would amount to a negative 22%.  The MACD indicator confirms the bearish signs suggested by the aforementioned pattern. The MACD lines dipped below the zero-line, after staying above it for almost a month.

Ethereum on a weekly time frame, has followed Bitcoin’s path and printed a red candle after five consecutive weeks of recording green candles. ETH’s price dipped by ~18% in the last week.

Source: TradingView

The Relative Strength Index for ETH was a few points short of crossing the overbought zone, It has dipped into the neutral territory, indicating exhaustion of the coin’s bullish momentum.

Peter Brandt’s tweet about the Head and Shoulder pattern received a lot of criticism from other crypto-traders.

@loomdart, a Twitter user, commented,

“Horrible trade…not even 30% probability. You will cover or get liquidated within 24hrs.”

Brandt replied,

“Trade. It was simply a chart. Control yourself. I do not even short cryptos. Easy and keep your pants on.”

Another Twitter user, @turnipshortlife, commented,

“Hey peter, huge fan. where should i set my bids. looking for financial freedom. im really emotional about my trades.”

The post Ethereum’s [ETH] chart displays formation of possible Head and Shoulder pattern; is a correction wave imminent? appeared first on AMBCrypto.

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