Can Ethereum Continue its Meteoric Rise?
After a dreadful 2018, cryptocurrencies are showing powerful signs of life, as institutional interest and the fear of missing out just begin to pick up steam.
Not only has Bitcoin (BTC) exploded 127% on the year so far, Ethereum (ETH) is up 91%.
And neither are showing any signs of slowing.
In fact, Ethereum could break well above $200 near-term, especially after the Commodity Futures and Trading Commission (CFTC) noted its was interested in ETH futures contracts. Should that happen, it would open up considerable institutional interest in the coin.
According to the CFTC, as noted by Coin Desk:
“I think we can get comfortable with an ether derivative being under our jurisdiction. We don’t do bold pronouncements, what we do is look at the applications before us. A derivatives exchange comes to us and says ‘we want to launch this particular product.’ If they came to us with a particular derivative that met our requirements, I think that there’s a good chance that it would be [allowed to be] self-certified by us.”
While some believe ETH could rally to $400, even $500 this year, we must still be cautious.
After all, no coin or stock simply runs up in a straight line forever without correction.
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For example, we want to keep an eye on our technical pivot points.
For one, ETH is challenging it upper Bollinger Band (2,20). Each time it has done so, we typically see a pullback before a run higher. Relative Strength (RSI) is also overbought near its 80-line, confirming an overbought read on the Bollinger Bands.
Also, Full Stochastics are above its 80-line, confirming an overbought condition as well.
The last thing we want to do is get caught up in a wave of profit taking and lose out on any money earned from the latest, explosive rally. The safe move may be to take some wins from the latest rally, and then look to enter again on a pullback.
At least, that’s what we’ve seen other smart traders do on rallies.
Or, you can always use a mental trailing stop loss to protect your trade after the run, too. As long as the coin continues to rally higher, the trailing stop loss will reset itself.
Hopefully, though, the coin will continue to rally back to the 2017-18 highs we enjoyed.
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