How markets are built

ETH has followed the more bearish path I outlined in my prior post hitting my target of .0225 BTC and even slightly below that .  It has even dropped slightly lower as I write this into the high .0219 range.

The bulk of this drop happened during the last 12-24 hours as we near the end of the DAO investment opportunity.  This is how markets are built – major volatility around news events to shake out investors both ways before taking price where it wants to go next. News events and volatility (big moves one way or the other, or both) are what bring new investors who see big money possible in an investment opportunity.

Patterns are far more important to me than news with rare exceptions and there has simply been no indication that anything particularly negative has occurred with ETH in the news about the DAO investment.  The funding seems to have been quite successful in fact.

I am viewing the current drop with cautious optimism as long as we can stay above .0175.   I have added to my position and will add more to get to 150% of my core position if lower prices show up.  I am holding back cash for serious volatility which can be major spikes that go below pattern targets very briefly.  You often see that during major news events (DAO situation).  So for example you might see a spike down below .0135 to clear stops but it would only last a matter of minutes or hours.

Be very aware that these spikes can work the other way as well. In any case I’m expecting volatility and want to be flexible to take advantage of it.

Below .0175 on a downward trend , the highest probability pattern will have failed and I will change my investment strategy. I deal in probabilities, not certainties and while I would rather be IN ETH than out of it currently, I will respect what the patterns show (and there are indicators showing the downside result is increasing in probability).

As for BTC, it went above one pattern I was relying upon to predict lower prices, but there are still higher probabilities that it goes lower and can hit my $385 USD target.  The inverse relationship between BTC and ETH continues to occur and I’ll continue to watch for that as one of my indicators (moderate–not consistent enough to be a strong indicator just yet) for investment decisions.

 

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