Large simple symmetrical a-b = c-d patterns aim for similar vicinity.
1 - The largest in light blue projects into the Model's range of 575.65 to 405.95
2 - The smallest in light purple projects slight above the Model's first target of 575.95
Averaged projection of the blue terminal and purple terminal levels is (623.69 + 501.17)/2 = 562.43, or slightly right at the Model's first target of 575.95
OCCULT MARKET GEOMETRIES:
Momental lines (representing dominant rated of change in price throughout any timeframe, running independent from channel lines) can be seen in the chart as running from bottom left to upper right. This is to contrast with a long-term bearish channel which is running from top-left to bottom-right.
These momental lines are likely to remain in force in this case, as in any other cases, imposing their omni-present forces on price, ... in this particular case acting as an overhead resistance.
OVERALL:
Price action is likely to seek a denouement in the shaded area. The arrow shows the probable direction of price. Invalidation of this would need to meet two important tests:
1 - Transgression of the momental line
and
2 - Committed accession above the 1944 level, whereby price would Break-Across + Close-Across ("BACA").
Stay tuned,
David Alcindor Predictive Analysis & Forecasting Denver, Colorado - USA
How is this bearish outlook and forecast of eyeing 405/575 by your model related to the bullish outlook from the 5-prime (5') of the WW pattern in this chart?
In this synthetic view of the BTC CHina chart, the geometry is quite obvious that a rallying has taken place from the 5-prime (5') position (900 CNY in the chart).
As a general rule, and as defined by you in a separate post, the MOST COMMON manifestation of the WW pattern is via a 5-prime completion.
You defined the "five prime", written as 5', as follows:
1 - Draw the 2-4 Line and the 1-3 Line.
2 - Copy the 2-4 Line, and place its beginning right at Point-3.
3 - This new 2-4 Line projection is now called the Target Line, or Profit Line, and will define Point 5' upon price validation of this line.
If the WW pattern is completed via a 5-prime completion the 1-4 Line is supposed to be the Take-Profit, or "TP" line.
You recommended taking full or partial profit IF and ONCE price reverses to the former level of Point-4, that is 2955 CNY in this BTCChina chart.
Reversal from Point-5' offers a high probability of reversal and validation of hitting price level of Point-4 .
So, which of the two scenarios is most probable at this point in time in the chart?
1) The bearish outlook and forecast of eyeing 405/575 by your model?
2) Or, the bullish outlook from the 5-prime (5') completion of the WW pattern, with a take profit level of 2955 CNY?
Kind regards.
devlspawn
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An interesting question I'm curious to see David's response. I assumed in the 3 in 1 composite chart he made that 5' never completed, but it clearly does in this BTCChina chart.
4xForecaster
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Hello @EYOU - I would look at two things: Specificity and sensitivity - The sensitivity of an analysis signals for a desired event (too sensitive a signal will cause a lot of false positive signals - for example, too sensitive a trap would close before the rabbit steps into it), whereas the specificity of an analysis represents what is actually sought (a low specificity would trigger a late signal - A trap for a rabbit that only catches rabbits and lets out lighter or larger paws) - What you are seeking is a high enough a sensitivity to alert you of the possibility of a condition met, as well as high-enough a specificity signaling that what you are seeking is truly happening.
Putting these concepts in the analysis, here is what a composite chart vs. a single chart can produce in terms of sensitivity vs. specificity:
1 - The very nature of a BTCUSD composite chart is that it will allow a lot of slippage, for instance, the an unanswered 5-prime level: Is it because the differences among the exchanges (BTCe, BitStamp, ... etc) interfere against one another that price ended up not lining up at the 5-prime position, or is it because it really reveals that as a consensus, these markets are not ready to rally as of yet?
So, as a composite, many voices are speaking at the same time, and the signal is likely to be specific as to what it means by representing a large group of constituents, but it is likely to lack the sensitivity.
2 - In contrast, the BTCCNY has proven to be the most sensitive to the lines defined in the analysis, as well as to its response to the background geometries. Now, note also that BTCCNY is the largest market there is, but is speaks with one single voice (in contrast to the composite chart, which is made iup of several exchanges) - This makes it the most sensitive market there is, as it does not submit its data against that of other exchanges, as in the composite.
For this reason, I have laid the analysis against it, and so far the lines have held quite consistently. This particular chart remains bearish based on the conditions defined in the analysis - For instance, it remains subdued to the momental line, and the 1944 level, two levels that would need to be broken to call it a valid bullish signal.
Overall, the composite chart has moved in a way that remains open to further downside, if 5-prime had to be hit (which remains unanswered in the composite chart). However, this is not an absolute rule, but keep in mind that the composite chart absorbs a lot more slippage, causing its price action to define a broader market consensus (more specific), yet lacking the precision of a single exchange (less sensitive).
In contrast, the single BTCCNY market represents a more sensitive activity of the crypto-currency, but lacks the ability to speak for all other exchanges (low specificity).
What I would concentrate on at this point is not sensitivity, which is what most traders grant too much importance (i.e.: did it trigger a technical alarm, such as validating a line, crossing a level), but rather concentrate on the specificity of a price action (i.e.: Is the price action representing a true and deliberate intention to move in the sought-after direction).
Looking at both charts, I have attempted to answer to both sensitivity and specificity concerns.
David Alcindor
MA100
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Thank you David for clarifying these two concepts: specificity and sensitivity. These concepts add to my overall analysis. It's been a pleasure reading your detailed analysis. Thank you for the time and effort that you put into these detailed analyses. Have a great weekend!
4xForecaster
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Hello @EYOU - Thank you for your kind feedback. Have a great and safe weekend as well - David
4xForecaster
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13 APR 2015 - Update: ... Looking at the larger picture:
From Twitter/LinkedIn:
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BTCCNY still carving lower-lows; Predictive/Forecasting Model still eyeing 575.65:
From Twitter/LinkedIn:
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BTCCNY drills through ML enamel layers, unsuccessfully, as per (persistently) bearish forecast:
@TradingView BTC
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David Alcindor