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After days of selling off, the Ethereum price is finally consolidating on the 1-hour timeframe. This consolidation gives us a chance to join the move lower in the coming days but in order to do that, we need to get a high-quality bearish continuation pattern.
And right now that bearish continuation pattern is just starting to form on the 1-hour timeframe. The question traders are asking now is, “what pattern will it be forming?”
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Pattern Options On The Table!
The first pattern we are watching that might form in the coming days is a Flag Pattern. We can already see it tracing out that range period on the 1-hour timeframe and once that range is over, we might see another sharp drop in the ETH price.
But for this pattern to remain valid, the ETH price must continue to trade below the resistance channel of the pattern. A break above this resistance channel invalidates the Flag Pattern and opens up the way for us to form a totally new pattern.
Final Verdict!
We are still bearish on Ethereum for the short term and believe we might see another sharp drop in the coming days. But to take advantage of this potential sell-off, we are waiting for a bearish continuation pattern to form on the 1-hour timeframe.
This bearish confirmation pattern will give us the best entries with the most favorable risk to reward for this move lower. And right now, we are seeing the bare bones of that pattern get formed on the ETH 1 hour timeframe and until it is completed, we will stand aside and wait.
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