We retraced down as I predicted, finished the 3rd minor wave and retraced for a new wave at about $9300. In this moment we are facing a dilemma where two scenarios are equally possible.
The bullish one is that we finished a 4th major wave and now started the 5th, heading to $10500 (in cyan).
But, because the waves were not very clear recently, we might have as well already done the 4th and 5th major wave. As we are coming from a minor 12345 diagonal wave that formed a rising wedge, the present wave pattern could as well be a 12345 minor impulse wave pattern which will form the A wave from a ABC correction (in red). In this case, we would eventually form a new bear flag, retrace down and start the B wave at about $8700-8900, and then reach something like $8100.
Not enough data yet to tell which scenario will play out; but I think they are equally probable now, bulls waiting for confirmation at the upper resistance level. Which one do you vote?
I think I would prefer the bearish one, it would be even better for the bulls, because after that we should start a new 12345 pattern to send us up with higher momentum and volume.
There would be a third scenario, even more bearish, but I think not so likely to happen: that we would be in a major downtrend impulse pattern and just ending the first wave.
Nevertheless, the medium bearish scenario is very possible, since we exited the bottom line of the uptrend channel, the RSI is not yet oversold, and MACD lines tend to go to negative values, suggesting bears are about to take control; and they didn't insist too much recently, so they might have largely recovered their forces.
The bullish one is that we finished a 4th major wave and now started the 5th, heading to $10500 (in cyan).
But, because the waves were not very clear recently, we might have as well already done the 4th and 5th major wave. As we are coming from a minor 12345 diagonal wave that formed a rising wedge, the present wave pattern could as well be a 12345 minor impulse wave pattern which will form the A wave from a ABC correction (in red). In this case, we would eventually form a new bear flag, retrace down and start the B wave at about $8700-8900, and then reach something like $8100.
Not enough data yet to tell which scenario will play out; but I think they are equally probable now, bulls waiting for confirmation at the upper resistance level. Which one do you vote?
I think I would prefer the bearish one, it would be even better for the bulls, because after that we should start a new 12345 pattern to send us up with higher momentum and volume.
There would be a third scenario, even more bearish, but I think not so likely to happen: that we would be in a major downtrend impulse pattern and just ending the first wave.
Nevertheless, the medium bearish scenario is very possible, since we exited the bottom line of the uptrend channel, the RSI is not yet oversold, and MACD lines tend to go to negative values, suggesting bears are about to take control; and they didn't insist too much recently, so they might have largely recovered their forces.
Comment:
We are right now testing the $9300 support. If we are going through, the bearish scenario will play the most likely.
Comment:
The second bear flag has broken down, starting the 5th minor wave. Now we are testing the blue downtrend line crossing the support at $9215, but I think it won't hold. Guess we are going to $8900. Bullish scenario invalidated for now.
Comment:
I've looked better; we have strong confluence support in this area. There is EMA100, there is the blue downtrend line, there is the yellow long time $9215 resistance that has turned into support and was confirmed several times, and there is also the green uptrend line. So the bulls still have a chance. If all these supports will hold, we have minor 5th truncated, so we can have a go for the major 5th that I thought failed. We have to wait and see...
Comment:
Ok, might have been a bear trap; market still undecided, but if we go again above the $9300 line we can believe in the bulls :)
Comment:
We have a green candle up to $9450 now. But I wouldn't go long for that. I would wait at least until we break up the bottom of the uptrend channel and the $9570 level which should be now resistance. I suppose it's a bull trap, like at the end of the previous flag.
Comment:
We are on the 5th minor red wave as expected. There has been so FOMO that generated shakeout, longs liquidated and all stuff that comes with such a fall, even if it was expected. Bears are now fighting with the support of the blue downtrend line, but we should go under and test a weak support line at $9098.
Eventually we are going to stop at $8900 support or even lower at $8700.
Note that this is a minor pattern and not a retracement of the major uptrend wave; if it was so, we should have had only 3 waves, not 5. Therefore this is only the first wave of a major ABC correction, or even 12345 major downtrend impulse, so I'm expecting a final target of $7800 or even lower.
Eventually we are going to stop at $8900 support or even lower at $8700.
Note that this is a minor pattern and not a retracement of the major uptrend wave; if it was so, we should have had only 3 waves, not 5. Therefore this is only the first wave of a major ABC correction, or even 12345 major downtrend impulse, so I'm expecting a final target of $7800 or even lower.
Comment:
The update is here:
