BTCUSD update: It appears Wave B is in play with one more leg expected to retest the high 6ks to low 7ks before the C Wave unfolds taking this market significantly lower.
Based on the structure at the moment, the current formation appears to be transitioning into the second leg of Wave B which often looks like a minor retrace of a zig zag formation. A higher low and push to the 6930 to 7330 resistance zone is what I am anticipating as the next move for this market.
Like I have been writing about, this is a tricky formation. It does not have to go as high as 6930, it may fail sooner. Or it may go slightly above the 7330 and then fail. There is no way to predict that movement for sure, the best I can do is forecast that as one possibility out of many. The key to using this information is being prepared IF the market chooses this outcome.
In terms of day trading, I think there is a good opportunity for longs with a relatively small stop (70 to 100 pts while aiming for a 150 to 200 point target). In terms of swing trades I am open and flexible to go long IF price can retest the 6050 level and show a reversal formation on a smaller time frame (1 hr or 30 min). That support area offers more attractive reward/risk in my opinion for longer time frame strategies (multi day is long for this market).
A break below the 6k to 5800 area (.618 of the current bullish swing) will signal that prices are likely going to break the 5400 support and retest the high 4ks (especially if there is a lower high established around the current levels).
I keep repeating this because I think it is easy to forget when prices are moving: you must be nimble. That means recognize change and adapt quickly. It is a day trading mindset which has no room for opinions. If you are slow to move, or stubborn, or don't have a clear trading plan with stops and targets predefined, then you really should not be trading this market at all.
My plan is simple: Buy the failed low and attempt to capitalize on the retest of the 6900 area. I am flexible, I have no opinions and no ego. To me, it is not about being right, it is about recognizing when variables are lining up that are in line with my plan, and recognizing when they are not and adjusting to that information. It is hard to share this thought process in real time because the market makes its moves when it makes them, and I am not in front of a computer 24 hours a day to write about it. This is why I always say you must learn to think on your own and use analysis like this for context and perspective to help confirm and adjust your own independent interpretation.
In summary, the current bullish retrace in this market is not poised to go back to 8k (at least not yet). B Waves often attract a lot of traders thinking they are buying a pullback, but in reality it is setting up for a much broader bearish wave (C Wave). That is the way the structure is unfolding at the moment and it can change. I have written about this situation before only for the market to consolidate and break out to new highs. What makes this situation different from those previous environments is there are 5 clear bullish waves complete which on this magnitude implies a much broader correction or consolidation at least. Don't get stuck on feelings and opinions in this market, it is too fast. TA is your best friend when you need speed, but you have to know it well. An RSI on a 15 minute chart is not going to help you unless you know how to interpret it within the context of the price action going on around it.
So if it were to break 7300 and shows no bearizch divergence and no signs of reversal then you'd go long again? #MissedTheDib #Bday ;(
PB3
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I hope alts will see bullish movement as the Wave C retrace unfolds, but how do you believe ETH & LTC will be effected? Do you still see those to be moving independently of BTC?
dragon
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@PB3, unfortunately, even though Eth and a currency purpose coin like Bitcoin, are two completely different technologies. Eth seems to be pinned to Btc pretty good. That is; until the new money comes in. Sees Eth's tech and decide to put some in there too for the long & hodl.
JuvianJulianHernandez
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First, thank you. I have been in a trading crash course the last month and really appreciate your perspective. I have learned that this crypto market remains heavily exposed to the fundamentals surrounding the CME futures in mid-December. Do you think, assuming arguendo that the futures go online Dec. 15, the c wave pullback will be complete by that time? Any ideas regarding strategy going into big news like that from CME?
CodyJournell
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Marc do you ever take any news and updates from MSM into account in your analysis or are they purely technical? I'm still a noob to TA but love your posts so curious if you think the mid December CME news will affect your analysis at all.
FUTUREBOYCOLIN
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Great call. Lines up precisely with my wave counts. Bout to be stuck in a long, sideways 4th wave. Overnight tonight til tomorrow AM more than likely, then the leg up to $7300+ like you say. I believe it will be an extended 5th due mostly to FOMO and lots of MSM Bitcoin exposure these past few weeks. They will call it a "rally."
MoonPickle
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@FUTUREBOYCOLIN, lol a 'rally' followed by news opinion releases about 'the end of bitcoin' when Wave C hits - can't wait!
FUTUREBOYCOLIN
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@MoonPickle, "Bitcoin Bounces Back from Fake Fork!"
"IS BITCOIN DEAD?!"
lesslevered
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Mr. Elliott lol. I would totally agree with your analysis if there weren't so many other outside factors influencing price action of Bitcoin. BTC is a part of a broader, burgeoning information/banking-industry, still in its infancy, demonstrating the characteristic expansiveness and growth that one sees with a new, civilization-changing technology. The traditional and rational behavior of a free market sort of go out the window in such a context. Perhaps there will be a C wave but I would not be a bit surprised to see BTC at or near $10,000 by Christmas. I do not have the flexibility to be THAT nimble, so I have an allocated amount of BTC that I do not touch, under any circumstances, as a means of risk management. I just sold a small portion of Bitcoin for USD at $7300 because I am mostly in agreement with your analysis, and I plan on using that to buy alts once they cool off a bit. Last few days we have seen a lot of money flowing into them and I look for them to pull back a bit.