BTCUSD - having topped on 14th April at $64,895.22 (on Bitstamp) its initial decline appears to be a leading diagonal of 3-3-3-3-3 structure completing on 20th July.
The rally since then has approached the proximity of 61.8% retracement around 50k - 52K as potential area of structural resistance, in an abc zigzag accompanied with multiple divergences on momentum indicators suggesting it might be forming a possible top of retracement bounce.
If this holds then retest of July low is very likely. If the next leg bearish leg has price symmetry with the initial leg then this projects possible decline towards 20k upon failure of July low to hold.
For perspective see the following time frame:
A Weekly Chart:
Similar retracement bounces are likely to be topping for other related instruments, for example: LTCUSD
ETHUSD
And XMRUSD
Caution This is my interpretation of price action using TA approach that I consider helps me the most, but could be completely wrong. Therefore, as always, do your own analysis for your trade requirement and ignore my views.
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DanV
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The wave "c" of abc retracement bounce was rather short. It seems like this one is developing in to another ending diagonal (minor rising wedge) If correct the it might complete around 52K
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Bitcoin is on the move. Will be very interesting to see how it reacts around 52k. Wave C also appears to be a diagonal. During most this move volume has been falling and momentum indicators have been weakening. So unless price really picks up speed, it might form retracement top.
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12Hr Chart above shows it retraced 2/3rd (66.66%) of the decline from April high in what appears to be potential abc zigzag, suggesting that this was a corrective bounce, which seems complete. If correct then most likely we might commence 2nd bearish cycle to develop OR morph in to some larger congestion pattern.
In 15 min time frame might be showing a 5 wave decline which if correct it would be impulsive decline suggesting further price weakness is most likely to follow.
Weekly Chart above we can note a developing bearish look with RSI potentially finding resistance at 60 and PPO might hook make a bearish hook if price continues to weaken.
seeing that option, here's a similar outlook. I'm bias towards the pullback here though. a complex correction before going down makes sense to.
DanV
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@NewWave_Traders, Thank you for sharing your analysis here. It is possible that the correction since April high to July (or May as you have it on your chart) is the complete and possible new bullish cycle has commenced which could lead the price towards 100k as per your analysis.
However, from what I see you have new low for wave (b). I traditional Elliot Wave Principle, abc corrective zigzag. So the question would be what are they correcting?
Secondly, when such zigzag forms a new low for wave (b) it would be expanded flat as in this case where wave (c) also makes new high above top of wave (a). In some circumstance wave (c) which should have 5 waves, could be so strong that it make a new all time high and in this case could reach typical 161.8% or in extreme situation 261.8% of the length of wave (a). Could it still make it towards 100k and would it still be abc corrective zigzag? Or should it be labelled differently to recognise that it might not be corrective zigzag rather a new impulse bullish cycle.
If you use line chart, then from April high we have a leading diagonal which would qualify as impulse wave and I would label the low of 20th July as wave (a). Then rightly wave (b) would be a corrective abc zigzag. Unless price picks up a massive momentum it is likely to make typical retracement to upside. So far we have 61.8%, it could go higher but would have to over come 52k and then the all time high. Once complete it would resume second leg to the downside with good change or retesting July low or making new lower low indicated on my main chart with label (c). Until this is complete I do not anticipate new bullish cycle.
There are other reasons based on technical why downside resolution is more likely than resuming a bullish cycle.
zznuzz
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@DanV, i believe it must go bellow 28805 to complete the regular flat patterne , we can see 28k 25k 20k why not , long term target will be 1.27 fib extension of the big impluse at around 80k $ ( maybe june 2022 )
DanV
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@zznuzz, Thank you for your comments. Yes it is possible that once we complete the correction it could resume a bullish cycle leading to new all time high
zznuzz
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@DanV, you are welcome
from my point of view, I think that the last wave is not 1.2.3.4.5 because 2 and 4 are just pullbacks, not forming any patterns and 1 3 5 have a lot of red candles
it can be WXYXZ ( if you see on 1D Time frame) or ABC whit a big correction ( if you see on 4h time frame )
and all that wave is the 2nd wave of the big corrective wave (the one that started on 22 June at 31642 $ not this one on 19 May)
maybe you should think about that case, I think we are in a big correction now to have the 2nd X ( WXY"X" Z ) like the one from 04 July to 21 July
and we can buy the last Z wave ( once we have a big rang and a strong candle closing above )
the structure can be changed in future so we have to see what the market will do
DanV
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@zznuzz, I appreciate your observation and accept that some of the moves are not easy to label due to some candles have big wicks on top and bottom and big over laps between swings.
The best we can do in removing some of the noise is to use line chart of closing prices or a Point & Figure (P&F) charts.
Above is a P&F chart using 10 points box size and 3 factor for reversal. It looks fairly clean and shows that the decline of the April high appears to be a Leading Diagonal (impulsive) and that the retracement rally could be an abc corrective zigzag. If this holds then possible retest of July low in case of double bottom or a truncated wave (C). If wave (C) creates a new lower low then anything from 28k - 16k or lower is possible before a new bullish cycle could develop.