Here are the three prevailing wave counts out there for BTC
1. The COVID-low is wave 2 and the Nov 2021 High is a B-wave for an ABC
2. The COVID-low is part of the previous impulse's correction creating a Running flat where the Nov-2021 high is wave 5 of the 2020-2021 bull market.
3. The COVID-low is wave 2 of the bull market and the Nov 2021 high is wave 5.
I won't spend a lot of time talking about option 3 as it is nearly impossible when digging into the sub-wave counts. I suspect anyone arguing for this wave count hasn't gone beyond just eyeballing the chart. Option 2 has a similar issue. For the Nov 2021 high to be a wave 5, you must get 3 waves down and it just doesn't work. You get 5 down and 3 up. So in order to get a 5-wave move for the 2020-2021 bull market the COVID-low MUST be wave 1.
But what if they are all wrong? As so often is the case with Elliott Wave Theory, the obvious is staring you right in the face. Without doing any analysis, just looking at the chart, the COVID-low is a textbook running flat. That means it takes the shape of a running flat. The same is true for the Nov 2021 high. It is a textbook overshooting B-wave. But everyone dismisses both of them as not being part of the bull market because that would make getting a 5 wave move impossible. But what if Elliott Wave Theory had an option where the COVID low could be part of a running flat and the Nov 2021 high could be part of an overshooting B wave? It does. Let me introduce you to ending diagonals.
And ending diagonal comes in 5h waves or C waves. It can come in any lower degree 5th wave or C wave. What it is, is a series of overlapping (usually) waves most often subdivided into 3-3-3-3-3. This allows both the obvious running flat and overshooting B wave to be what they want to be.
What will be challenging for a lot of people is that this diagonal will start off a lot like anyone would expect the bull market to start off. We will get 5 waves up and a deep 3 waves down, giving us a what looks like a 1 and 2 of the bull market. Because this wave 1 (as people will call it) will be so powerful, people will be calling it an obvious sign of a super-cycle. This will be my A and B wave of wave 3. Wave 4 will be another deep correction, and many will be calling this wave 1 of wave 3.
Something you always need to be aware of in diagonals is the real possibility of a truncated wave 5. The odds of wave 5 truncation go up quite a bit in diagonals. The way way we will be able to figure this out is by looking at the sub-wave counts. If they seem weak and confined it will likely lead to truncation. I do believe truncation is highly likely as a weaker bitcoin could lead to money flowing into altcoins. But only time will tell which it will be.
Breaking the Nov-2022 will negate this wave count, but more realistically, breaking March 2023 low will effectively negate this wave count. But this will lead to a more bearish wave count where we are going to get a deeper combo correction. This is highly unlikely at the moment. If we get a higher-than-expected move up through the summer to 55-64k, this will really validate my count. The reason is, a wave 1 of this magnitude would lead to astronomical projections for an impulsive 5-wave move.
There will be many trading opportunities within this diagonal. More detailed analysis is required near the highs and lows of this diagonal to find good targets with strong risk-to-reward ratios. Ultimately my target for Bitcoin is between 98k-105k before we get a cataclysmic correction back down below 10k. This correction will present great opportunities as well as it will likely be some kind of flat where wave b retraces a substantial part of wave A before extending slightly beyond the end of wave A.
1. The COVID-low is wave 2 and the Nov 2021 High is a B-wave for an ABC
2. The COVID-low is part of the previous impulse's correction creating a Running flat where the Nov-2021 high is wave 5 of the 2020-2021 bull market.
3. The COVID-low is wave 2 of the bull market and the Nov 2021 high is wave 5.
I won't spend a lot of time talking about option 3 as it is nearly impossible when digging into the sub-wave counts. I suspect anyone arguing for this wave count hasn't gone beyond just eyeballing the chart. Option 2 has a similar issue. For the Nov 2021 high to be a wave 5, you must get 3 waves down and it just doesn't work. You get 5 down and 3 up. So in order to get a 5-wave move for the 2020-2021 bull market the COVID-low MUST be wave 1.
But what if they are all wrong? As so often is the case with Elliott Wave Theory, the obvious is staring you right in the face. Without doing any analysis, just looking at the chart, the COVID-low is a textbook running flat. That means it takes the shape of a running flat. The same is true for the Nov 2021 high. It is a textbook overshooting B-wave. But everyone dismisses both of them as not being part of the bull market because that would make getting a 5 wave move impossible. But what if Elliott Wave Theory had an option where the COVID low could be part of a running flat and the Nov 2021 high could be part of an overshooting B wave? It does. Let me introduce you to ending diagonals.
And ending diagonal comes in 5h waves or C waves. It can come in any lower degree 5th wave or C wave. What it is, is a series of overlapping (usually) waves most often subdivided into 3-3-3-3-3. This allows both the obvious running flat and overshooting B wave to be what they want to be.
What will be challenging for a lot of people is that this diagonal will start off a lot like anyone would expect the bull market to start off. We will get 5 waves up and a deep 3 waves down, giving us a what looks like a 1 and 2 of the bull market. Because this wave 1 (as people will call it) will be so powerful, people will be calling it an obvious sign of a super-cycle. This will be my A and B wave of wave 3. Wave 4 will be another deep correction, and many will be calling this wave 1 of wave 3.
Something you always need to be aware of in diagonals is the real possibility of a truncated wave 5. The odds of wave 5 truncation go up quite a bit in diagonals. The way way we will be able to figure this out is by looking at the sub-wave counts. If they seem weak and confined it will likely lead to truncation. I do believe truncation is highly likely as a weaker bitcoin could lead to money flowing into altcoins. But only time will tell which it will be.
Breaking the Nov-2022 will negate this wave count, but more realistically, breaking March 2023 low will effectively negate this wave count. But this will lead to a more bearish wave count where we are going to get a deeper combo correction. This is highly unlikely at the moment. If we get a higher-than-expected move up through the summer to 55-64k, this will really validate my count. The reason is, a wave 1 of this magnitude would lead to astronomical projections for an impulsive 5-wave move.
There will be many trading opportunities within this diagonal. More detailed analysis is required near the highs and lows of this diagonal to find good targets with strong risk-to-reward ratios. Ultimately my target for Bitcoin is between 98k-105k before we get a cataclysmic correction back down below 10k. This correction will present great opportunities as well as it will likely be some kind of flat where wave b retraces a substantial part of wave A before extending slightly beyond the end of wave A.
