The Cumulative Case for the BTC Bear

5 hari lalu

Let's do a full top down analysis. There's a lot of chatter about this and that why BTC is rallying and selling, but let's take a step back and look at the full context of the TA.

Because here a simple bit of logic - if the TA forecasts were drawing the chart before the news, the news is not as important at the TA. The thing that has already told you what would come is the logical thing to use to attempt to roadmap what might be ahead.

And it was a foreseeable technical break.

That was a basic Elliot forecast off a butterfly high and this is correct within a small margin of error on every swing.

Not only is it getting the top and the bottom, it is also getting the correct style the swings are in.


We'll look more at that later but first let's just zoom out and take a overall view of where we are.

All of the main action in BTC over the last 6 months or so has been inside the zone of the 1.27 - 1.61 of the last major swing.

When we're in this zone we can typically map out three main moves that are likely to happen. One is a breakout upwards, one is a correction and then an uptrend and one is a market break. A trend failure. Full reversal of the trend.

Heading into this area, any of these three things are fair game. It's wise to be prepare for all of these whenever you get to a major 161 level. A trend decision will be made there.

As you can see from the 3 paths proposed, the bull breakout obviously failed. The corrective move would be predicted to end around 80K and it pending failure now and the bear move currently looks most fitting.

Using simple PA has its limitations but if we were to sell hard from here ... it could hardly be said to be unexpected from the context of the monthly chart. Right?


In the original Elliot thesis when we got into the latter end of the break leg there were a couple things we could look for. One would be a spike out to a predictable level (wave 5) and the other would be a correction to a predictable level and in a predictable style (ABC correction).

These would have been 77K - 93K. Here's the post about that before the low was made.

There should be parabolic action in a two leg correction for the ABC.

That would look like this.


From here the market would have to do three things.

One, stop rallying. Seemingly inexplicably. It seems to have only one way it can go but it goes the other.

Second is we have to make the drop in the Elliot manner with a break, pullback and then a bigger break.

We have this.


Notice how this little rally move is marked into the template for the rally and drop.

These conditions would now imply we're inside of a bigger wave 3.

And a big wave 3 predicts a capitulation which would be no less than 50% off the high and I currently feel we're probably talking more like it hitting 45K or so before a bounce.

Nothing to say that bounce would have to be the low.

It's a good time to consider your risk exposure to a break in my opinion.

5 hari lalu

Dagangan aktif

Took a bunch of shorts into the rally and more deep OTM puts on the exposed stocks.