BTCUSD Update: Recent market structure implies underlying strength even though low volume holds it back. With 8/1 just around the corner this market is likely to stay quiet, but IF a bullish catalyst unfolds on Tuesday, there is no structural resistance holding this thing back from new highs and beyond.
The recent upswing off of the 1826 low happens to be relatively close to the 1921 support (.382 of the broader trend) which was in place BEFORE the bounce. The fact that price found so much momentum off this level indicates that the broader bullish trend is intact which implies supports should hold and resistances should break moving forward. Even though the more recent upswing to 2922 did not go to new highs, it is still strong because structure has generated a new support zone from 2053 to 2250 (relative to .618) and the 2500 support level (relative to .382). Price has already reacted off of the 2500 area by going slightly below, but again moving quickly away from the level which is another sign of strength (there is even a nice triple bottom formation visible on smaller time frames in that area).
In terms of Wave count, the retracement to 1826 is clearly a completion of a larger degree Wave 4, identified not just by the chart formations, but also the location of the low which is in the immediate area of the .382 support of the broader trend. And this puts this market in the midst of a upward Wave 5. These are the most predictable waves in my opinion since they require 4 waves to be in place. Within the Wave 5, this market is in a minor Wave 2 correction which can retest the low 2400 support or even the 2250 to 2053 support zone. If this happens, this is a perfectly normal Wave 2 and these support areas serve as good reference points for reversal patterns to begin Wave 3 of the larger 5.
As far as resistance goes, the only structure this market presents at the moment is the 2550 to 2750 area which price is within at the moment. This is a minor resistance and is relative to the .618 of the recent bearish swing. A bullish catalyst on Tuesday will likely push through this area like it is not even there.
In summary, this market appears poised to push new highs based on the technical structure at the moment. Keep in mind, technicals cannot anticipate fundamental surprises especially of the magnitude that can unfold on Tuesday. Anything can happen. If participants like the outcome on Tuesday, then this market will be on its way to forming a Wave 3 of 5 which according to the Wave Principle, is NEVER the shortest wave. If the market is not satisfied with the outcome, and price pushes below the 2053 level, that will cancel out the bullish structure and most likely thrust this market into a broader consolidation.
Hi i am a crypto trader newbie which Tools should i use on TradingView and wich plan is good for me.Also wich news or website would you recommend,Thanks,Richard,
WaineNZeddmo
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Looking forward to reading your opinion on BTCUSD
RogueDave
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The art and science of Elliott Wave counts requires harmony at both the macro and micro levels. You believe Wave 1 of 5 completed at 2938. Ok, I have that as an alternate count. Then you proceed to call the 2400, Wave 2. I can construct and did establish a count that supports that. Where I'm having extreme difficulty with your macro count, is in the next motive wave up from 2400 to 2825. It counts fine as i, ii, and iii of v of 3 of 5 from a micro perspective. The problem is, iv of v of 3 of 5 just intruded into i of v of 3 of 5 due to the double 3 correction of iii.
What is your detailed count that supports the upward move from 2400 to 2825, and then accounts for the correction to 2569.69?
MarcPMarkets
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@RogueDave, great detail on your wave count that is a lot of counting! I learned a long time ago to keep the wave counts simple. We are using time bars to separate trading periods and micro counts do not fit well into them occasionally which causes a ton of confusion. I count the broader moves because they carry more weight. Simplicity is key for my evaluations, and I do not trade on Elliot Wave alone because of its extreme subjectivity. I am calling the move off of 1800 a wave 1 because of it is a large push off of the larger degree Wave 4 which completed at a sensible level. The retrace has not gone below 100% of this Wave 1 of 5, so I am calling it Wave 2. I also do not get caught up on the corrective waves. I have gotten into a lot of bad positions and caught on wrong sides because of sticking too closely to the counts. So I do not rely on Elliot Wave, I use it to give me a general idea, or basic road map. I want to see motive waves and they need to be clear. If they are not clear, I look for other information.
salmanijaz
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Another master piece :)
Its so tempting to get on this train but as you mentioned that it can go either way and unpredictability is too high. Reminds me of the Warren Buffet quote of greed and patience :)
Do you think that Segwit can cause a bulls trap ? I am thinking of opening a small position with a tight SL position but afraid that it will be too volatile :(
MarcPMarkets
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@salmanijaz, the hard fork or segwit or whatever they are calling the big event will not be predictable on a technical basis. Anything can happen. My thinking is if a really good price presents itself, and your broker has not halted your trading ability, or you can place limit orders under the market, why not buy some? A really good price is something like 1500. Technically this would void all the bullish structure, but if its a price spike and only touches an extreme low for a few minutes or less, and pops back up, then it is nothing more than panic and once the market becomes stable again, the technicals will be credible again. Buying in this fashion requires that you can take risk, because you have to be willing to lose your investment. That is the mentally you must have, because the move can be very dramatic and if you are too big, it will be very uncomfortable.