Can you feel the move coming in the air? I can, I can feel it deep, deep down in my plummmms. In our last chart "Bitcoin: The only thing certain in life is death and STIMMIES" (linked in the related charts) we delved into a confluence of high time frame bearish signals a midst, what we believe, is the very early stages of a historic bull cycle in the works, and out how to make some sense of it all. We then also delved a bit into the elliot wave analysis as trading range/trendless market (on lower time frames) was tough to really gain meaningful information on. This idea will put a period on our thinking, as it would be appear a move is imminent.
In the big picture side of things (1d chart zoomed out provided in published chart above) we have what looks like a terminal 5th wave of larger degree 3rd wave. This would mean we could have real nice pull back here for wave 4 before moving higher. Since wave 2 was shallow it would make sense, due to the law of alternation, that wave 4 would be the 'deep' correction, on a relative basis, of the two.
Lets take a look at the 1h to see how time plays in and, to our relief, suggests resolution of this move in the very near future. Since terminal waves are composed of 5 corrective waves, which overlap, it would make sense that we would see a corrective move up to resolve our count on larger time frames. We spoke about how it had appeared a zig zag a-b-c was developing, and the rules to confirm that. Here is the same chart I showed: So the chart did break the 0-b line as expected which would seem to bring everything together. Phew. It all makes sense! But wait, not so fast...how come the price has not crashed yet!? Well, does that mean we are wrong? No. Elliot Wave tells us that if you break your 0-b, or 2-4 line, yet the price does not do what you were expecting a degree above, that is an indication of terminal activity. Terminals can only be found in 5th waves or C waves which 'terminate' a larger degree move, hence the nomenclature : ) So, this lead me to believe we are actually in a terminal c wave of our a-b-c zig zag. Here's what that looks like: ...let me remind you that overlap and all corrective waves are the characteristics of the 5 waves of the terminal! Looks like, we may be onto something here. While I left up the red dotted 0-b line for educational purposes, it is now less relevant to what is happening. Now, the more relevant line is the 2-4 black dotted line of which wave 5 should break down, and also retrace the whole wave, in the time it took to form.
So what does it all mean bazel? (austin powers voice). It means we should have a vewwy, vewwy intewesting weekend ahead. I for one would love to see some volatility back in the market, and that at least, I am sure we will see. All of this leads me to believe the move is down. Speaking more generally about the market, it seems everyone is long, if everyone is long, who's left to buy!? Further, don't look now, but if we are to have a nice dip this weekend, that would make 3 red weekly candles in a row, which the deceptive price action of this week has quite effectively distracted the participants of this market from acknowledging this possibility (soon to be probability?).
Anyway, that should do it for this one. If anyone needs me i'll be in the office bumping heavy metal at absurd volumes. This weekend should be real fun. Watch the waters my frens, the sharks are swimming, and if they smell even a bit of blood, things could get messy.
Best of luck to all, J
DISCLOSURE: As always, not shminancial shmidvice
Komen
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oke, as expected the price broke the 2-4 line of our wave c terminal and retraced all of wave 5 on the 1h time frame. Since this corroborates our larger time frame count on the daily chart this means the possibility of our deep correction down for a wave 4 has now turned into a probability. Elliot wave is not a crystal ball, nor is it a robotic step by step instruction on how trading and risk management should be performed on markets, but rather a very effective way of understanding the way markets work in terms of their psychology, and fractal nature, in order gain an edge. In terms of elliot, the larger time frame count is 'officially' confirmed upon the price breaking below the purple 2-4 line shown on our published chart (again a daily chart) within the time it took wave 5 to form which was around 8 days. So, considering our lower time frames count confirmed the end of wave 5 around 3 days ago, we should expect this break down to occur within the next 5 days or so. Again, I now believe this is a probability as opposed to a possibility due to the confirmation on lower time frames. How you would treat this from a trading perspective would totally depend on your own style, risk tolerance, etc. Essentially, in my view, I now see it as a probability that the price has already begun a deep correction which could go to let say ~28k-40k or so, but we can become even more confident when the price breaks below the purple trendline within the next 5-6 days or so. Some people might have already taken a trade and would add more upon the break down, or already have taken a bigger sized trade with a tighter stop, etc. All that comes down to a conversation related to trading in general.
All the above, imo is extremely valuable information, we know what to expect, and we know how to evaluate if for some reason the analysis is wrong i.e. if the price does not break that line within the next 5-6 days, or if it explodes much higher before then such taht one could use their judgement that it wont be breaking it within the alotted time rules, the picture should be totally re-evaluated.
gluck!
Komen
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hmmm what to make of this price action?
...and the plot thickens ~ 53 hours to break below the red 0-b line. Time needed to break the purple 2-4 line is extended since wave 5 took longer than anticipated. In reality red and purple are in a similar price range, so all it really says is give it a bit more time to break down. Was that one heck of a bull trap? or the start of a big move up. The good news is we find out soon enough, also, I just saved a ton of money on my car insurance.
Way I see it, either the price performs as above or does the opposite and starts shattering ath's. I'm sticking wit my analysis till proven otherwise.
Komen
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Don't worry about this low time frame stuff, was moving fast on the last update, I could explain it in depth but i'd lose most people. For educational purposes: anyway, this is what the end of a move looks like, its not always neat and perfect but the principle is that considering a rising purple 2-4 line, as time passes, the breakdown becomes more and more inevitable. Everything still going according to plan, looks like we've already started to break down. Basically, the only thing that'd make me change my mind would be something to convince me we will not be breaking down through the purple line in the published chart within the next week or so. Highly unlikely at this point. It looks like the breakdown should occur any day now.
Komen
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*Puts back on heavy metal music on absurd volumes*
Komen
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'i got a good feeling about dis one' ...should be an interesting week ahead. I can still feel it deep down in my plums. Just hope I am in tune with them. Btw everyone should tune their plums at least once daily. It's only healthy.
Komen
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green: check
red:
purple:
These lines are basically like magnets...when the price conforms to the time rules allotted to them it corroborates your count one degree higher and thus momentum builds in a given direction as they are confirmed.
Komen
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green: check
red: check
purple: check
All systems go. Markets are fascinating, take note of the psychology around you. We are still in the denial stage, as we break below 50k we enter the bargaining stage. Below 40k brings about acceptance and eventually the market capitulates...by that time 'I bought the dip' is totally out of fashion and borderline embarrising to proclaim.
Komen
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Welcome to the crypto 'currency wars' of 2021...in 2017 they realized bitcoin had won so when the game was over they realized their only desperate move left was to try to outpump ripple to overtake bitcoin, the bitcoin whales crashed the market instead knowing it would obviously recover, and come back stronger after shaking out the weak hands. Now here we are again, except this time they are trying the same with ethereum, the fundamentals could not be weaker for this coin, but they don't care. Will the bitcoin whales respond like they did in 2017 and rekt both bitcoin and eth like they did with xrp and bitcoin then? Stay tuned. I got my popcorn ready.
Komen
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Silicon valley is into eth deeep. If they lose, they lose big.
Komen
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Yes i'm aware the price broke below 30k...sorry I don't think the bottom is in yet. How could the bottom be in if etherium is still four digits?
I think Garbageman Sachs and J Pee Morgan want to buy in cheaper and they have the capital to do damage to the price if they want. Once you see the fake news media talking about Bitcoins bubble and how it's popping and going to zero, that's when you know they are beginning their fear campaign to crash the price.
Dopaminexx
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@jayd603, which is why i sold, to buy in cheaper too >_< lol
Damn, that was a good read. Seems like solid analysis. 👍
DennisLeeBTC
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Possibly this:
ltc-joe
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@DennisLeeBTC, could be, fits with EW but just looking at higher time frames TA I tend to think if the big drop is coming it would be sooner rather than later. So we could sort of get it out of the way, create lots of panic for the new market participants with a nice shake out, and continue on up higher. There is a real nice bearish div on weekly rsi that pretty much depends on us breaking down here over these next few days.
coinwide
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thx for the chart, looks we are still on plan. any updates so far?
ltc-joe
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@coinwide, ty sir, nope not really. As I said, below 50k we transition from the denial to bargaining stage...