Is this the BIG Turn for Bitcoin? Start of Major Bullish Wave?
As you can tell from my last idea, I've been looking for a bounce for over week.
But now bitcoin it is a very important level. It's due or die time. Here is why:
1. We've had big downward momentum and no signs of buyers... yet
2. Nothing major happened at Consensus
3. We are at the critical 60-65% fibonacci retracement level.
4. This could be a wave 2 finishing into a wave 3
5. There are several descending wedges that could lead to a move up.
Many Elliott Wave analysts believe that we started a wave 1 rally from $6500 and we are trying to complete the wave 2. In EW theory, the wave 3 is usually the biggest impulse wave, especially when starting a new bull market rally. So if this is indeed a wave 3, then we should see some strong bull market impulses that break above $10k and likely up to $13k before another correction.
Do I think this is going to happen? No.
I believe this market has more work to do on the downside.
However, I am a trader. Not a fortune teller. I look at risk reward. And the most likely point for this market to turn and start a wave 3 is right now. Between $7700 and $8100. And even better, if we slighlty front run the 61.8% market where everyone had there orders. As I said in my last update, I went long last night on the dip.
IF we are starting a bull market impulse then I want to be positioned for it. EVEN if I think it is more likely to go down. I'll let price action guide me and let me know if I should stay in my long or close my position. And I have stops in place in case the market wants to turn hard.
If $7700 doesn't hold, then this will reduce the probability that we see a wave 3. $7500 and I'd be completely out. Even though it can go all the way to $6500 and still technically be a wave, its really not a sign of strength to go that low so I wouldn't be looking for a big bull move if we fail here.
As I was typing this, we just broke out of the bottom wedge, so the next key level $8400-$8500 at the top of the bigger wedge (orange). Lot of resistance there so failing in that area could force another test of the bottom of the wedge (blue).
As I've said in the past, history says a parabola should take 8-10 months to find a bottom so I've been looking for July to September for a bottom. And usually you get a low volatility period before a market turns. Often people give up on the asset. Sentiment will be low. However, bitcoin moves faster than any other asset I've traded. And nothing has to follow historic patterns. I remain open to the idea that the bull market has started. If price action says we are bullish then I will trade bullish and will turn to a long term bull with confirmation on the weekly chart. A weekly swing low at $10k would be huge for my bias.
This will be a major pivot point if can turn up and start stacking green candles. I'm a long term bull and sick of trading a bear market so I'd be happy to see it. But if not, I'll reposition and wait a few months.
But now bitcoin it is a very important level. It's due or die time. Here is why:
1. We've had big downward momentum and no signs of buyers... yet
2. Nothing major happened at Consensus
3. We are at the critical 60-65% fibonacci retracement level.
4. This could be a wave 2 finishing into a wave 3
5. There are several descending wedges that could lead to a move up.
Many Elliott Wave analysts believe that we started a wave 1 rally from $6500 and we are trying to complete the wave 2. In EW theory, the wave 3 is usually the biggest impulse wave, especially when starting a new bull market rally. So if this is indeed a wave 3, then we should see some strong bull market impulses that break above $10k and likely up to $13k before another correction.
Do I think this is going to happen? No.
I believe this market has more work to do on the downside.
However, I am a trader. Not a fortune teller. I look at risk reward. And the most likely point for this market to turn and start a wave 3 is right now. Between $7700 and $8100. And even better, if we slighlty front run the 61.8% market where everyone had there orders. As I said in my last update, I went long last night on the dip.
IF we are starting a bull market impulse then I want to be positioned for it. EVEN if I think it is more likely to go down. I'll let price action guide me and let me know if I should stay in my long or close my position. And I have stops in place in case the market wants to turn hard.
If $7700 doesn't hold, then this will reduce the probability that we see a wave 3. $7500 and I'd be completely out. Even though it can go all the way to $6500 and still technically be a wave, its really not a sign of strength to go that low so I wouldn't be looking for a big bull move if we fail here.
As I was typing this, we just broke out of the bottom wedge, so the next key level $8400-$8500 at the top of the bigger wedge (orange). Lot of resistance there so failing in that area could force another test of the bottom of the wedge (blue).
As I've said in the past, history says a parabola should take 8-10 months to find a bottom so I've been looking for July to September for a bottom. And usually you get a low volatility period before a market turns. Often people give up on the asset. Sentiment will be low. However, bitcoin moves faster than any other asset I've traded. And nothing has to follow historic patterns. I remain open to the idea that the bull market has started. If price action says we are bullish then I will trade bullish and will turn to a long term bull with confirmation on the weekly chart. A weekly swing low at $10k would be huge for my bias.
This will be a major pivot point if can turn up and start stacking green candles. I'm a long term bull and sick of trading a bear market so I'd be happy to see it. But if not, I'll reposition and wait a few months.
Komentar:
I had already took some off the table. But now we are breaking below the IHS neckline so I'm being cautious. This could be a dip that recovers and if we got back to $8500 I would expect higher prices. If price can't get back over $8400 by the end of the day, then I will lighten up.
I had already took some off the table. But now we are breaking below the IHS neckline so I'm being cautious. This could be a dip that recovers and if we got back to $8500 I would expect higher prices. If price can't get back over $8400 by the end of the day, then I will lighten up.
Komentar:
Again due to weakness I got out of most of my position, though I continued to hold some as we've been oversold since $8200. Hitting $8000 I bought back part of my long position. I'll be looking for a small bounce now at minimum. Maybe a larger bounce.
We'll see how price reactive. But the 4 hour is past TD9 it will find a low if it hasn't already and probably get back to $8200-$8300 from here. If it gets all t way to $7800 at the .618 then that I would and hold for a larger bounce.
Again due to weakness I got out of most of my position, though I continued to hold some as we've been oversold since $8200. Hitting $8000 I bought back part of my long position. I'll be looking for a small bounce now at minimum. Maybe a larger bounce.
We'll see how price reactive. But the 4 hour is past TD9 it will find a low if it hasn't already and probably get back to $8200-$8300 from here. If it gets all t way to $7800 at the .618 then that I would and hold for a larger bounce.
Komentar:
I was stopped out and generally this turned out to be one of the worst trades I've made in 3 months. I still would have done it again because the set up for a big bullish wave was there even though I'm cleary bearish and not surprised by this.
But stops got me out and I generally watched the market and scalped a bit here and there. I'll be shorting any major rally from here and buying when we get close to the 30 day cycle low in about a week.
I was stopped out and generally this turned out to be one of the worst trades I've made in 3 months. I still would have done it again because the set up for a big bullish wave was there even though I'm cleary bearish and not surprised by this.
But stops got me out and I generally watched the market and scalped a bit here and there. I'll be shorting any major rally from here and buying when we get close to the 30 day cycle low in about a week.
Komentar:
Let me reiterate that I'm not surprised we went down. I am surprised we went down so aggressively without a bounce at this stage in the bear market. This is what forced me to take my stop losses, but that is part of trading. And I think this is generally a bad signal for the next 2-3 month
Bitcoin got into the $8500 resistance so this would be a good area for consolidation. But since we never got the $7800 fib at the .618, I think people are going to FOMO. Price flip on TD, so I would expect Bitcoin to hit the IHS target near $8800.
Taking some profit here. May add if we get another dip. Partial stops at break even, some stops in profits as my buy price was under $8000.