This rules are:
1. Wave 2 cannot retrace more than 100% of Wave 1. As you can see the first rule is respected.
2. Wave 3 can never be the shortest of waves 1, 3, and 5. Although Wave 3 cannot be the shortest wave, it is typically the longest of all the five Waves.
3. Wave 4 can never overlap Wave 1. Now we are waiting to validate this rule at this moment.
Look at the 1st wave with Fibonacci: from the bottom at 1$ to 1171.3$ you can see that the 61.8 was highly respected (green zone) and then it was broken.
As shown in the chart, also the 78.6 was highly respected. Indeed from here started the accumulation period that has taken the bitcoin to the all time highs.
Look at the 3rd wave with Fibonacci: a pretty similiar movement. Here there is the same movement of the previous one, the 61.8 level was highly respected, then there was the breakdown and now it is on the support of 78.6.
You know that it is a manipulated market, but if bitcoin will follow the Theory, and it will not overlap wave 1 at 1171.3$ there will be the fifth wave that could take the price over the ATH.
But is there any tool that can provide a nice view for timing?
Yes, Fibonacci can also help us in this. So I use Fibonacci Time Zone to indicate a very probable inversion area.
Starting from the bottom to the top of the first big movement. (You can see the numbers of vertical lines at the bottom of the chart)
Here we have timezones:
- 1-2nd downtrend
- 2-3rd small period of correction
- 3-5rd continuation of
- 5-8th a period of accumulation before the break of the resistance (61.8 Fibonacci - 448.1$)
- 8-13th beginning of the new uptrend (wave 3) ATH
- 13-21st that anticipate the big crash (the beginning of the correction of 4th ). So downtrend and probable period of accumulation.
At the end, if btc doesn't overlap 1171.3$, thanks to the Theory and thanks to Fibonacci, we are ready for the next bull run that will take btc over the ATH at the end of the 21st Fibonacci Timezone (August 2020).
Just a simple question from a neewbie: Why should be wave 5 as long as wave 3? Because I've been reading in Eliott Wave theory books that wave 3 is always the longest and wave 5 is the last and lowest impulse. Thanks for your answer in advance! Have a great day :))
You're right it is also written in the description!
I set a target zone from 27813$ (that is the first target for fibo -0.618) to 120000$ max.
Because I used two different types of 4th wave:
- One could reach the support zone around 3500$ (below blue zone 78.6 fibo)
- The other could reach around 2000$ (I think it could be a great final support)
These waves are both equivalent to the maximum extension they can have as a 5th wave, for this reason I highlighted that orange area as a zone for a price target!