With broad risk sentiment hyper focused on geopolitical risks, short-term price action is likely to hinge on the dynamic situation in Ukraine.
If sentiment continues to sour, and sour quickly, here’s a simple technical setup on ETH/USD to watch for potential short-term gains or to limit risk.
ETH/USD: 4-Hour
ETH/USD 4-Hour Crypto Chart
Tensions in Ukraine have flared on the session after reports of shelling across the front, likely the driver behind today’s broad risk aversion behavior throughout the financial markets.
And if you think that this situation could worsen and spark further risk-off moves in the short-to-medium term, and you want to express that through crypto, then Ether is an asset to watch for a potential setup.
Ether is THE big daddy alt coin in the crypto space, so it’s super liquid and often times, correlates strongly with broad market/risk sentiment. A great asset to trade for short-term plays and this particular environment.
Based on the price action on the 4-hour chart above, technical traders could be following fundamental/news traders soon as ETH/USD dips from a strong resistance area (between 3000 – 3,300), confirming that sellers have taken back control for now.
And if we continue to see negative geopolitical developments continue to drive risk-off sentiment, then a break of the rising ‘lows’ pattern marked on the chart above may be the technical signal to draw in fresh sellers on ETH/USD. Or at the very least, prompt longer-term long positions to reduce risk.
Of course, if the scenario in Ukraine turns around quickly towards a diplomatic solution, then it’s likely that rising ‘lows’ pattern could draw in fresh buyers and those who’ve recently shorted from higher in the range.
So, it looks like the markets will remain focused on geopolitical risks for now and we definitely have to stay on our toes? But what’s your take on ETH/USD and broad risk sentiment? Let me know in the comments section below!
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