123 method of confirming the end of a bear market applied to BTC
This is drawn from Thomas Bulkowski's 'Trading Classic Chart Patterns' - in which he is himself drawing on Victor Sperandeo's 1991 book 'Trader Vic - Methods of a Wall Street Master.'
Personally, I am not waiting for confirmation that we are out of the bear market but it will be worth recognising what phase of the market we are in. If we get a confirmation of a trend change from bear to bull, that will at least be rather welcome change.
The 1, 2, 3 method is:
First draw a line from the highest high (A) to the lowest low (C) in a way that doesn't cut through price until after the lowest low was reached.
1. Price must close above the trend-line (done),
2. Price must stop making lower lows (done) and also re-test the low (done),
3. Price should then climb above the previous minor high (B) - this hasn't happened yet so I await confirmation on a break of $8500. Two out of three isn't bad so far.
This method is taken from equity markets, which differ markedly from Crypto markets. However, it is just another tool in the tool bag. In equity markets, fulfilment of the 3 conditions normally means a short-term 35% gain as the bulls take control again. Depending on how things go over the next week or so, we may have an early confirmation relatively soon. Then again we may have to wait for some time if we don't break $8500 and / or make a new lower low.
If we break $7500 in the next day or two, then we are still in the game for $8500.
I am not a professional, a financial adviser, or your Mum. Please do your own research and I wish you the best of luck. Go the bulls!
Personally, I am not waiting for confirmation that we are out of the bear market but it will be worth recognising what phase of the market we are in. If we get a confirmation of a trend change from bear to bull, that will at least be rather welcome change.
The 1, 2, 3 method is:
First draw a line from the highest high (A) to the lowest low (C) in a way that doesn't cut through price until after the lowest low was reached.
1. Price must close above the trend-line (done),
2. Price must stop making lower lows (done) and also re-test the low (done),
3. Price should then climb above the previous minor high (B) - this hasn't happened yet so I await confirmation on a break of $8500. Two out of three isn't bad so far.
This method is taken from equity markets, which differ markedly from Crypto markets. However, it is just another tool in the tool bag. In equity markets, fulfilment of the 3 conditions normally means a short-term 35% gain as the bulls take control again. Depending on how things go over the next week or so, we may have an early confirmation relatively soon. Then again we may have to wait for some time if we don't break $8500 and / or make a new lower low.
If we break $7500 in the next day or two, then we are still in the game for $8500.
I am not a professional, a financial adviser, or your Mum. Please do your own research and I wish you the best of luck. Go the bulls!
Comment:
I'm trying to wake the bulls up in my own small way by showing that was on Elliot wave, pattern trading (once there is a upper trend-line break of the triangle / wedge pattern), trend theories, and also RSI bullish divergence are all pointing the same direction - towards a trend change from bear to bull. All these different ways of looking at the market confirm at different places / prices and may all converge at a certain price point (if the bullishness continues) and the brakes will be off.
Comment:
BTW the bullish RSI divergence appears from the 1st to the 13th of August with lower lows in the price but RSI fails to go lower and makes a series of bounces off the 20 - 25 RSI range.
Comment:
Not just yet. Sorry guys more bearishness to come over the next week - and possibly longer.