Ethereum is currently trading in the vicinity of the 4100 USD price range which is an area noted by Chris Weston as a historic breakout mark during the highs of December. His chart has an ascending tendency yet indicates the region of pullback, which occurs between 4100 4200.
In the past these levels provide resistance. A report published in Journal of Financial Economics, 2023 confirmed the results that resistance zones in crypto are likely to cause profit taking. However, the robust surge of Ethereum to levels above 4000 in September reveals a positive trend and Weston advises the traders to keen away on forming haste longs.
Ethereum Analysis by Chris Weston
Weston recommends: Don t buy the dip, buy the rip when the others buy the dip.
His Ethereum analysis resembles the paper by Chen, Goldstein, and Hristov (2021), Review of Financial Studies, that discovered that momentum trades (late purchases following breakouts) beat dip buys by 15 percent in crypto markets.
Momentum traders follow the trend rather than attempting to pick dips; the momentum traders simply move with the wave of market psychology and herd. To traders, this implies that patience is of the essence as Ethereum price takes a test with this significant level. A breakout on good volume up through 4200 might start a run up to 4500 or even 5000.
Momentum Trading What is it?
Momentum trading refers to the case in which traders accumulate assets that are already increasing and the ones that are decreasing. Borrow strength, not weakness- enter already after the confirmation of a bullish momentum Fast turnaround/decisions/turnaround times of weeks or even days Risk-management -through stop-losses, to prevent reversals With Ethereum in 2022, this might translate to waiting until the price convincingly breaks above resistance before getting in.
