From my last published chart of Bitcoin on Mgox suggested potential flat 3-3-5 correction in the position of wave (iv) of larger wave 3. You can refer to that chart here (along with Youtube video explaining what typical 3-3-5 is)
I cautiously suggested minimum downside target of 400, but pointed out that even 250 or lower would not surprise me and still would conform to wave (iv) correction in larger up trend. This is when price was still in 1000 area having bounced from low in 500 zone. Many argued with me that with low at 500 satisfied correction and now that we are in new up trend. I tried to explain why that view would not be correct since the drop to 500 did not exhibit 5 wave internal in the 2nd leg down. Further the bounce did not exhibit new impulsive 5 wave up. I noted that both the drop and subsequent bounce to 100 area only had 3 swing down and 3 swings up. Hence, my expectation of 3-3-5 flat.
Without labouring, the final leg down appear to have exhibited very impulsive leg down and could well have form 5 waves down, but the following the event of MGox no more data is available, hence the final minor wave is incomplete.
do not have the back history, however, I am carrying over the wave count from MGox to and consider that since the High at 1160 we are in wave (iv) of 3.
It amazes me that some with rudimentary Elliottewave (EW) knowledge continue to argue about the wave labels since that 1160 high and every drop they can count 5 waves. I do not consider myself an authority but do have reasonable good grasp of the basic concept of the EW. I an struggling to place clear 5 wave counts on any of the major legs since that high.
appears to be developing a triangle (as suppose to 3-3-5 flat in the case of MGox). This type of triangle often forms in position of wave iv. They have 5 swings labelled as a-b-c-d-e as show in my chart and each leg could have 3 swings each making it 3-3-3-3-3 triangle.
If this interpretation is correct we are in finale leg down being my preferred count which also has nice suggesting further downside potential. The Alternate is shown in turquoise with leg (d) as high as 865 - 870 zone before dropping for the final leg to low around 400 zone or little higher.
One reason adding further weight to this still being in congestion and not a new Impulsive move up is that so far the bounce from 25th Feb low has not exhibited impulsive 5 wave type of move to the upside.
Watching 5 min, 15 min and such time frame often looks very exiting but sadly do not dictate the larger time frame no matter how many divergences are noted. So, till I have evidence to the contrary, we are the wave (iv) Triangle correction since the 30th November 2013 high and are likely to retest the low around 400.
I understand that Elliott wave analysis is very different than "conventional wisdom", although was a bit worried (as a potential btc buyer) that community seems to view bitcoin as continuously raising so far, with 3 major peaks reached already. Your comments will be highly appreciated :)
If that holds then we will be in wave (iv) within larger wave 3 using the MTGox chart. Where in my subsequent charts has cautious downside target of 400 but also stated that I would not be surprise to see lower prices even 200. Well that now is history. Transferring the same to Bitstamp, we do not quite see the same action. So I am inclined to think for now we are in Triangle which if it holds we are likely to drop to 400 for retest before continuing higher. So in conclusion for now we should expect lower prices unless price action disprove that. But also even of we seems to be breaking out of the triangle it is the nature of the up trend that will give clues if it is likely to be new impulsive leg to the upside or just a bounce. But trading and investing is never one way Street so prudent money management should always be in place that would not lead you to loss all profit or indeed your investment capital. Hope it helps.