ETHBTC Perspective And Levels:Clear Wave Count Implies Strength.

ETHBTC Update: In terms of BTC, this market has a clearer wave count that points to one more upswing before a broader correction unfolds. The high .089s to the low .090s area is a reasonable zone to expect a Wave 5 completion which sheds light on the potential of the upcoming ETH upswing.

I have been covering the ETHUSD market very closely, and since not much has changed since my previous report, now would be a good time to explore it from another perspective. Many participants buy and sell in terms of BTC, and because of this, there is an additional layer of complexity that can cause confusion when evaluating these markets against the USD.

Before I get into the levels, I want to mention that when you buy ETH against BTC, you are essentially shorting BTC. Just like when you buy the EUR against the USD, you are long EUR / short USD. Compared to BTC, fiat is extremely stable. In the fiat markets we are using leverage to take advantage of fluctuations worth fractions of a penny, while BTC climbs dollars per minute.

It is possible for ETH and BTC to go up at the same time, but then the focus becomes about the rate of change. ETH must rise faster than BTC and this pair will go up. If both are rising at an equal rate, this pair will show no progress. And if BTC is rising faster, ETH will decline. And this is why I prefer to buy against the USD. USD is generally weak to begin with, and even if there is any buying, it is fractional compared to the price action in ETH.

So let's talk about levels and what this chart tells us about ETH. First it is important to note that .060 to .079 BTC is a very broad support zone that is relative to the .618 of the larger bullish swing if you look back at the price history. And at the moment, bullish price structure is working it's way back up and away from this area which is a bullish sign. There is also a support zone at the .07014 area to the .07376 which needs to be maintained in order for ETH to go higher.

As far as resistance, there is zone from .08306 to .08781 which is relative to the .618 of the recent broader bearish swing. A price push through this area can lead to a retest of the low .090's which is not unreasonable when we observe the current wave count.

In terms of Elliott Wave, there is a clear impulse structure in place that meets all the requirements. The current bottom of Wave 4 does not overlap into the area of Wave 1 and this market is in the early part of a Wave 5. And since Wave 5's have more of a tendency to extend, reaching into the low .090's to complete Wave 5 is within reason.

In summary, observing these markets from different perspectives can provide additional clues about what to expect in the near term. This chart, just like ETHUSD, is full of bullish structures and implies that if anything, ETH should rise at a faster rate than BTC. Since I buy ETH in terms of USD, I use this chart to give me additional insight, and not for buy and sell signals.

Comments and questions welcome.