In just two short weeks, EOS – the fifth largest cryptocurrency by market capitalization – fell from an all-time high of $23.03 to as low as $12.05, losing almost 48% of its value. As the price of EOS is approaching the $15 mark now, traders are wondering what to expect from now on – more weakness or the bulls’ return. So let’s put our Elliott Wave glasses on and see if a recognizable pattern is going to emerge on the hourly chart below.
This chart allows us to see the wave structure of the plunge from $23.03. As visible, EOS’ decline could easily be seen as a simple A-B-C zigzag correction, with a triangle in the position of wave B. Wave A is a leading diagonal, while wave C is a regular five-wave impulse. In addition, the entire sequence has been developing between the parallel lines of a corrective channel.
According to the theory, corrections develop against the larger trend. Here, this mean EOS is still in an uptrend and since the A-B-C decline seems to be complete, it makes sense for this uptrend to resume now. This tells us that EOS is likely going to breach the upper line of the channel and reach a new all-time high over $23.03 in the weeks ahead. It pays to keep a positive outlook as long as EOSUSD trades above the end of wave C. An invalidation level at $12.05 and first targets over $23 give traders a great risk/reward ratio of 3.
What would Bitcoin bring this week? That is the subject of discussion in our premium analysis due out today!