$ETH $2700 Is Becoming The New Resistance And The Reason Is This 👇🏽
The Price is getting rejected due to the Bearish Fair Value Gap. ❌❌
The drastic fall from July 30th - Aug 5th saw a huge decline in prices and created a big fair value gap when closing was below $2700 on Sunday, Aug 4th.
A strong reversal came into play with multiple attempts to break the resistance at $2700 (lower trendline of rectangle), but rejected every time. A rejection from this level shows that the price is respecting the FVG and there could be further decline as well. So, the FVG stays valid.
But if we take a look at the chart again, the bullish FVG formed a few weeks ago became invalid since the price came breaking down sharp and quick with the day's closing not just below the FVG but also below $3200. After this a retest occurred when the price broke the bullish FVG but closed inside the box and it started to go down again the very next day.
Hence for ETH to make an upside move, the price needs to close above the bearish FVG. Once it does that, it'll retest the support again and will continue its rise. And this FVG will become invalid.
When people ask me "How do you trade? What's your setup?" I simply reply "I trade FVG's".
*This is not investment advice. Please do your own research before taking any trade.
