NEO - The Bottom is In! What Next?

BITTREX:NEOBTC   Neo / Bitcoin
Some have asked about NEO and to provide an update. Fortunately it is relatively easy as I keep notes on all my holdings in chart form. Attached is the cleaned up version. You should also have notes and charts saved for your core coins so you are not recreating the wheel every time, it also improves your TA when you can go back and see what you were thinking and the subsequent outcome. This is critical for learning to read trends and perfect your technique. So I have clarified a few things for this article, but the trends are quite clear, and as one would expect we are right where we should be regardless of the news in China!!

But what about China, it had to have an affect right? Well if you believe China was the reason for the selloff, then what caused the bull trap that same week? Trends, EW and Fibb provided the guidance long before we got there. Notice the correction ended right where the down trend and long term trend intersected. Right at the .786 fibb retracement and into wave 4 as we would have expected from EW and Fibb? Failure to realize this was way overbought and was following almost an identical formation as we saw in wave 3 where it pulled back to the .786 level is denying markets cycle and trends always gravitate back to the mean. Especially seeing the swings in BTC and ETH as of late, NEO has been rather, well, channeled. These pullbacks have little to do with news, and everything to do with market cycles, trends, and sentiment. The faster you'll learn how to identify these cycles and trends, the quicker you will profit from them. Still don't believe? Well then what caused the selloff in wave 4 that corrected .786? News from Argentina?

Ok on to the chart.
If you look at the chart, wave 5 is very much extended and hence the correction is as expected, into the level of wave 4 at the .786 fibb retracement . This is very typical for a parabolic run.

The base of wave 5 (ABCDE) corrective pattern provided a nice positive trend channel (green), which when extended, was resistance at the end of wave 1 and should be supportive during a correction. I also show the negative trend channel from the correction from wave 5 (red). You can see clearly where these intersected, and this would most likely form a level of resistance and support. Well after C we got our bounce, on the news that Trump was elected right? LOL just had to say it. But it is a typical bull trap or dead cat bounce. Are you starting to see a pattern? It's a little lower than expected but not out of line with other coins that also corrected to the .786 level.

We have now continued sideways in the upper half of our original trend formed during the beginning of wave 5. This is a full correction in my opinion and I don't see a further one from here, but you must keep in mind the market goes by it's own rules not ours. To me this is a signal that this is still a bullish coin, but we cannot trade until we know for sure.

Hence my consolidation box. Currently I am trading the box (but that is another blog). What I can tell you is if it breaks to the upside and supports or I have a secondary signal the bull is breaking out, I will add to my position. In the event it breaks the lower channel where I have the green line drawn is where I will actually sell some of or even all of the core as this may be a signal something fundamentally is breaking down. NEO is not as far advanced as the likes of ETH, but it has the potential to be a $300 coin like etherium, only time will tell, but in the meantime we have a plan. If you have read previous posts I have detailed how and what I use the RSI for, so if you haven't read it, then I might suggest reading it.

Hi @goldbug1, I've been looking at the NEO chart and it looks like it might actually be halfway through forming a cup on the 1H. Does that make sense to you?
Hi goldbug1. Thank you for your invaluable insights and time you put into the charts - wish I had stumbled upon you sooner. Don't wish to be pessimistic but unless other factors come into play, i suspect NEO will fall to pre-1 August support level of approx 0.003BTC as per 90 day chart. As a noobie, I bought at 0.009, the Aug 13 high, so will be holding for some time to come! Am 60% in BTC, so hoping your BTC bear doesn't go into hibernation! Also 5% in GNT.
Hi, wich would be your secondary signal that the bull is breaking out?
+1 Balas
@Ayran_x, I use RSI and HMA's almost exclusively. I wrote an article on how I use the RSI to spot bull and bear markets. It's different then most people use it.
Pelorus goldbug1
@goldbug1, Hi, where can I read the article?
+1 Balas
@Pelorus, Yep it's one of my earlier ones NEO #2 is the title. I explain with some details how I use it. Remember i adjust the bar count, and the levels for every chart, I do not use the general defaults though sometimes they work.
This is great education for me, thanks Goldbug for being so willing to share.
+1 Balas
goldbug1 oilyprata
@oilyprata, Your welcome, thank you for your comment!
+1 Balas
I got some NEO at the end of August, at ~0.0077 BTC with a mid-term in mind at least till end of this year. Should one understand from your TA that it would hardly reach 0.01 BTC this year?
+2 Balas
goldbug1 viewfinder
@viewfinder, I'm not sure of that but it is definitely possible. 2 month cycle would put us into November.
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