The Beginning of the Next Bitcoin Bubble (Elliott Wave Analysis)

BITSTAMP:BTCUSD   Bitcoin / Dollar
It looks like Bitcoin has just completed Wave (c) which is most likely a terminal impulse. This means that the overall (unconfirmed) pattern is an Irregular Flat on the daily time-frame, however, this pattern remains unconfirmed until we break the 0-B base line. Until then it is still possible that a triangle could form here. If this is actually an Irregular Flat then the target could be anywhere from 700-1125usd for this impulsive wave, if its a triangle the target could be as low as 600usd.

The terminal is more or less confirmed though so I am betting that this is the bottom and we'll get an extremely strong leg up from this point on. Momentum on all timeframes agrees and we are starting to trend up pretty hard. Being that this is a terminal the retracement of this entire pattern should be very fast. My time targets for the end of this "bubble" are around the time Quarterly settlement is for OKC Futures , which is March 25th, either on or around that date will most likely be where the top is.

It looks like the bottom is in here so it would be a good idea to stop out if the bottom of wave (c) does not hold. Everything looks good from here though, the bears are out of momentum and we still need another impulse to follow the trend we started back in November. any downside should be short lived until we get near the top.

Good Luck and Happy Trading!
Trade closed: stop reached: Retraced way to far, I stopped out at zero profit. Looks like the terminal impulse count I have here is most likely wrong. No trades from this point until there is a better confirmation.

This is very likely in a triangle since it ignored the 2-4 trendline and retraced so far but the bottom seems like it is going to hold. It is always best to wait for confirmation of the triangle before going long though.
Trade active:

Still waiting for the final breakout but it looks like it will bounce soon.

Stage 1 (0-B Trendline) is confirmed. After Stage 2 confirmation the uptrend should become extremely violent.

Note that since wave c is a terminal it has to fully retrace faster than 50% of the time of the terminal, typically less than 25%. As you can see it is well on its way. This is stage 2 confirmation for both the terminal AND the flat. After this final confirmation it is extremely unlikely that any other pattern is going to form and we should get some pretty violent uptrend.
Trade closed manually:

Forming a triangle here is still very likely. I closed off of this huge dump because following a 0-B trendline such a violent drop is very uncharacteristic of a break up, meaning that we are most likely in some sort of triangle. My bet is that we just completed Wave D and we are now beginning Wave E.

This makes a lot of sense because momentum on a lot of timeframes has began to show bearish divergences. However, this could still be wrong, as said above the flat isn't confirmed until we break above the high of Wave C faster than Wave C was formed, for the triangle it isn't confirmed until we form and break the B-D trendline.

For now it is wise to avoid taking an significant positions until the larger patterns are confirmed. You may miss out on a small amount of the uptrend but in the end it won't make much of a difference.

Another Bullseye :)

We are nearing support but this is still knife-catching zone so I am not going to take out any longs here. I will be picking up coins soon though once this starts bouncing a little bit, but I won't be going long until this breaks up.

Basically from here there are a few possibilities, the one's I'm currently considering are that either:
a) I'm wrong/early
b) This is the end of Wave e and we are forming a limiting triangle
c) This is the end of Wave a of e and we are forming a non-limiting triangle

If b) is correct, we should break the B-D trendline faster than Wave e took to form, if c) is correct we will probably keep going sideways for about a month before finally breaking up. If a) is correct, we are most likely going to continue down from here and possibly create a different pattern.

Now since this leaves too many conflicting possibilities I am not going to be taking out any longs here, I will, however, be monitoring this very closely and be picking up coins on spot very soon. As soon as I get the confirmation that the big triangle is confirmed I will go long and ride the rocket up.

Now some may say, "why wait for the breakout if you could catch it early and make more money?" and I say that it isn't worth the RISK of being wrong. If you wait until the trend changes and the patterns are confirmed the chances of you being wrong becomes significantly smaller than if you try to catch the knife right now. Your risk to reward may not be quite as fantastic but your odds are much better and the best part is that you are catching the trade right at the perfect moment. immediately before the trend explodes in the direction you predicted.

I actually think that something like this scribble is still very likely. Mainly because Wave e is very small in time compared to the other waves of the triangle. It is possible that this is the end of Wave e because it has met the minimum price requirement, however, it is NOT confirmed unless we break the B-D Trendline faster than Wave e took to form, which means we would need to start bouncing very hard as soon as this bottoms out. Since I think that is somewhat unlikely based on the current momentum, I am betting that we get more congested into the apex from here.

However, since this is just a guess the smart thing to do from here is just wait and see. Regardless of what happens a metric fuck ton of money will be made just catching the break out. There is also always the possibility that I'm wrong because these patterns are still unconfirmed and I'm pretty much just speculating on what could happen and not so much making a definitive prediction at this point.

It seems like wave e has bottomed out. If it breaks the B-D trendline faster than wave e was formed it will be the first stage of confirmation meaning that Wave e is most likely complete, and then the second and final stage of confirmation for the entire triangle will be when we break above the high created by wave b of the triangle. At that point it should be fairly safe to get extremely aggressive with longs up until we hit the time zone occupied by the apex of the triangle, which is most likely where the post-triangular thrust will conclude. The price target is also very solid with this count and if we get both stages of confirmations it is very likely that this chart will produce a direct hit at 4200cny (647usd) on April 16th
Comment: Wave e failed to confirm on the previous chart I posted so it is most likely not going to break up just yet, though it is still possible. There are still no safe trades to be made here.

From here, It is possible we form into a double combination ending on a non-limiting triangle for wave e or something else. The pattern was never confirmed so it was really just loose speculation to begin with. The fact that Wave e failed to confirm by being retraced so slowly is a good reason to sit on your hands until we get a better confirmation that the larger pattern is completed.

Like I said earlier the most likely pattern to form here would be a double combination. I think we've already reached the bottom, especially because wave e retraced exactly 61.8% of wave d, we just have to finish going sideways before wave e is actually complete. After wave e is complete we should get a violent thrust upwards which will get more violent with each stage of confirmation.

If this above chart is right it could be possible to catch the very bottom of wave e with low risk, and then compound profits at each stage of confirmation and make massive gains. This would be the ideal trade. For now all we can do is hope that it happens :)

Should take roughly a week before the smaller triangle of the double combination completes, once that triangle is confirmed it is possible to take an early position on the bigger triangle but you should definitely be careful holding any leveraged longs until the larger triangle is confirmed.

It looks like I was right about forming into a smaller triangle here. It still looks like we aren't done yet tho, most likely this is wave d. I am expecting it to get very very tight into the apex and probably won't break out until its at the very tip of the triangle around April 20th. Until then its a good idea to continue to refrain from trying to trade inside of this chop. Triangles tend to be the most treacherous trading environments up until they break out and its much easier to make money just riding a large trend in one direction.

I avoid going into the lower timeframe and trading inside of triangles too because I like to keep a clear head of the long-term picture. Going into the short-term tends to make me lose sight of the longer-term or try to catch the trade at the wrong time and get burned. It is definitely possible to do quick scalps but i'd rather save my limited analytical ability for the big trade, and also keep my stress levels at a minimum so when it comes time to make the big trade I am ready and in a good mindset.

This triangle is actually non-limiting now too, which means that the max target could be as high as 1000 USD. Now we just wait for the smaller triangle to be confirmed before we take the trade.
Trade active:

It appears that I was tricked by the Exception Rule because on the lower time-frames it appeared that wave e of wave (e) had not confirmed, but on this chart you can see pretty clearly that wave e DID confirm and that we are probably half way through being completely broken up. The final stage of confirmation obviously being when we break the high of the triangle at 460.

Also because the exception rule appeared on the lower timeframes it is a pretty good indication that this WAS a major turning point. Also another indication that this is the end is that wave e of e ends perfectly at .618 of wave a on the 4h chart, generally that is where you'd expect wave e to end and it ends there with a direct hit.

It's really hard to imagine this being anything but a break up at this point. The only other possibility that I can see at the moment is that this is still part of wave d but that is very very unlikely based on all the surrounding evidence. Again the final confirmation is when it breaks 460 but i think its fairly safe to activate the trade from here, and after it breaks 460 you can safely close the charts for a couple weeks.
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good job,thank you so much
+1 Reply
Intuit PRO ucdos1988
You're welcome :)
Also, I think u once told me the points on your charts represent the H/L of the period /2 ...interesting, what drew u towards using this?
Intuit PRO btc_joe
It provides more accurate measurements of price when comparing waves according to Neely.
Interesting, thanks.
Any good resources or links u can point me to to learn more about EW? Should I just read "The elliot principle" or w.e it's called. Thanks.
+1 Reply
Intuit PRO btc_joe
Master Elliott Wave by Glenn Neely is the best resource I've found. I like it a lot more than EWP
+1 Reply
Awesome, i'll check it out, thanks so much.
Killed it
+2 Reply
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