Ethereum has formed a \u201cgolden cross\u201d pattern on the 1-week timeframe, marking the second such signal this year. While the long-term implications could be very positive if history repeats itself, there are reasons to temper expectations.<\/p>\n\n
1W ETHUSD has formed a golden cross<\/a> for the second time in 2023. A golden cross is a buy signal in moving average-based trading systems. It suggests that the trend is moving in an upward direction and because trends tend to persist, this is notable.<\/p>\n The golden signal occurs when a shorter-term moving average (the 50-week MA) crosses through a longer-term moving average (the 200-week MA) from below. A death cross<\/a> forms when the opposite happens.<\/p>\n The last confirmed golden cross for Ethereum in December 2020 preceded a massive 600% rally over the next year to the asset\u2019s all-time high near $4,900. A repeat move of similar magnitude this time would put Ethereum above $12,000\u2014over six times today\u2019s price of around $2,000.<\/p>\n However, it is important to note that not all golden crosses lead to the anticipated upside. In 2023 alone, 1W ETHUSD has death crossed and golden crossed twice now, demonstrating how moving average-based systems are prone to whipsaw without an established trend to follow.<\/p>\n\n The whipsawing death cross and golden cross price action on the Ethereum 1-week chart failed to generate follow-through in either direction. So how can we be sure that this isn\u2019t yet another premature crossover?<\/p>\n This is where the Average Directional Index (ADX) comes in when gauging the validity of moving average crosses. The ADX aims to measure trend strength, typically on a scale of 0 to 100.<\/p>\n As the 1-week ADX edges up from below 20, it confirms growing momentum that reduces the odds of more whipsawing price action. Traders often use such ADX readings to confirm golden\/death crosses and enter only the most high-conviction signals.<\/p>\n The 1W ETHUSD Average Directional Index isn\u2019t yet above 20, but is approaching this key level. Above it, it gives the golden cross much more validity.<\/p>","protected":false},"excerpt":{"rendered":" <\/p>\n Ethereum has formed a \u201cgolden cross\u201d pattern on the 1-week timeframe, marking the second such signal this year. While the long-term implications could be very positive if history repeats itself, there are reasons to temper expectations.<\/p>\nAn Uptrend Or More Whipsaw? How The ADX Confirms Trends<\/h2>\n
Ethereum Golden Cross And A Possible Target For New ATHs<\/h2>\n