Anatomy of a Bear Market: 2018 Bear Market or Correction

BITSTAMP:BTCUSD   Bitcoin / U.S. Dollar
In the Anatomy of a Bear Market Series I compare 3 Bitcoin Bear markets using Daily Ichimoku and S/R: 2013, 2014 and 2018. Here's my take on the current 2018 market.

2018 is both a bear market and a bull market's correction (it's not clear how it will play out) with the following structure:
- both flat cloud tops and bottoms, thick cloud => mixed market
- shallow S1 and S2 supports => somewhat healthy bullish correction like in 2013
- no major S1, S2 => somewhat bearish like in 2014
- steep trend line angle => likely an up trend, like in 2013
- no S3 dip so far (a large dip = bullish , shallow dip = bearish continuation)
- key trend support is not broken yet

This market structure is similar to the 2014 Bear Market, but it also has elements of the 2013 bullish correction market, so it can be a correction as well.

- to go up we must first dip down in S3. The larger this dip will be the greater the probability of a subsequent up trend. Different arrows show potential moves.
Possible alt deeper S3 and R3 points are mapped from corresponding levels on 2013 and 2014 charts with their trend line relationships preserved.

- we will definitely NOT retest prev highs by June 11th when a flat cloud bottom starts on a Weekly (~10000) => likely bearish continuation
And in a couple of days we will also have a flat cloud bottom on a Daily (8150). So, a bounce down on both D1 and W1 will be likely.
It seems that we can only retest R2 10000 on August 6th at the earliest and in early September for the 2nd time.

For now we can decline further or go as high as 8150, then crash down. We will likely break down the trend support in S3 at some point.

Good Luck!

Please don't trade based only on my analysis. This is not a financial advice. Do you own research to confirm.
Comment: Compare with 2013 and 2014 markets:



At this point, im probably the only one that sees a barrier triangle with the flat side at 12k.
@Acel, 12K not possible in the near future, those days are gone
Acel RagingRocketBull
@RagingRocketBull, i honestly dont know what makes you so bearish recently. The history has no answer to the future. The crash may happen but not how the majority expects it to.

Its always impossible until it happens. Take care :)
@Acel, Tough times. And apparently bearish June is also a yearly thing. Don't know why you're still not convinced. I guess, hope just never dies
Acel RagingRocketBull
@RagingRocketBull, im open to both scenarios, i cant tunnel vision on just one of them. This is just the way i have been always thinking and acting, never picking a side but be open to everything. But truth is i lean towards the bullish one. No new ATH this year tho.

You know, just playing the odds untill they favor one side. DJI is "crashing" they will start comparing it with previous crashes, this is just how human psychology works, impulsive and looking back for an answer.
@Acel, well isn't TA supposed to predict the price based solely on history and prev stats? If not, why use it at all. Yes, you should always consider all possible scenarios, but at the end you'll still have to pick a side to enter a trade in either direction. I simply don't see much arguments in favor of the bulls right now to the best of my knowledge.
Acel RagingRocketBull
@RagingRocketBull, It is, but you cant compare 1:1, if it was like that it would be too easy and we would just copy paste the fractals.

I dont see much either, but as of now i see a retest of 7.8-8 . There is definately gonna be sell pressure over there and we will see what happens next, maybe a retest of that low and a bounce at 6.8k.

But, there is no much favor for the bear scenario either. There is sideways action ( accumulation or distribution ) with decreasing volume and volatility, so a perma bull can say "sell pressure is decreasing overall" . Constance Brown says on her book 2 things but i wont quote them exactly:

1) A C wave in a triangle can be complex and it always causes confusion by dividing both the bears and the bulls
2) A pattern that is repeating and slowly shrinking its part of a correction and will lead to a spectacular move

She doesnt state which way tho. lol

Now, you may say "part of the correction and triangle so its a B before the C leg down". BUT! Dont forget that it can be a b of a B wave up.

Its a clear 50-50 on the longer term, honestly. Besides, the moku is just a 50% retracement tool with different amount of candles (inputs) and offsetting them to the right.
@Acel, a retest of 8K is possible - H1,H4,D1 RSIs 30 all show oversold but the trend is still weak so far and it shouldn't be - shows caution and lack of interest from buyers. But as ichimoku shows, we won't go any higher than 8150 (EMA 50 rejection). From there we will likely bounce down and break the trend line in S3 dip. After that quick dip an up trend becomes possible because of the combined force of buyers and sellers: bears will buy to take profit, some bulls will sell to cover their losses and others will buy the dips. Of course triangles can break both ways, but I don't consider just the triangle alone. We have a history of bearish patterns, bearish ichimoku, almost zero volume. Also don't forget the slowly tanking EMAs and a death cross on a daily. I couldn't find even one history example to the contrary. Also if we move up from 5K to 25K that's a 5x increase, and 8K to 25K - only 3x which is kinda meeh.
+1 Reply
Acel RagingRocketBull
@RagingRocketBull, Thats all cool but i didnt say bullish scenario is a new ATH. :D

I cant tell about the effectiveness of the moku. Mathematically its a 50% retracement with 2 different inputs and offset their difference to the right. Think about it as MACD, Kijun and Tenkan are the MACD and the signal and the cloud is the histogram but offseted to the right. Its not a projection tool, its "the history projected to the future".
My EW tells me the same bro:

According to that we are going to start the wave ((iii)) impulsive wave down. This is also a bearish pennant coming all the way from 8.58k to 7.27k means that we go down to 6.2k first according to the Pennant but my EW says the bottom is 5.45k