This is an Elliott wave analysis of the March 14, 2024, market top and new all-time high of Bitcoin.
On January 23, Bitcoin ended a two-week correction after briefly breaking the 0.618 Fibonacci retracement level from the 2022 bear market, and marking the price of 38524 dollars as the end point, using the Bitcoin INDEX data. From that point Bitcoin proceeded upward in five waves to 43863 [wave one, ((i)) ], 52372 [wave three, ((iii)) ], and to a new all-time high at 73757 on March 14.
The last stretch to the all-time high was marked by very erratic price action, with several steep drops in price and rapid recoveries. From an Elliott wave perspective, this could not be deemed as bullish behavior, and no distinct Elliott wave impulses may be identified at the prevailing wave degrees of the market.
Careful examination reveals that the entire market top from March 4 to March 20 should be assigned as a correction, including the all-time high. Wave five, ((v)), of the ascending wave sequence actually occurred on March 4 at the level of $68717, just short of the then-ATH of November 2021. This type of market top is called an irregular top. I believe that Elliott originally called it an unorthodox top. The actual price top is the end of corrective wave B of an ABC structure, or X of a WXY. Here I am assigning this irregular correction as a double.correction, WXY. The first wave W was a sharp abc spike down, followed by a lead-in abc into a triangle correction in wave X, which produced the top price. This was followed by the correction sequence that most traders identified as THE correction, a deep retrace to the bottom of the trend channel, wave Y.
The final market retrace, Y, was limited by the intersection of a long-term (LT) channel Fibonnaci trend line, and a shorter term (ST) trend line of the run from 38.5 k. This Fibonacci support was enhanced by the 200-period moving average in the 4H timeframe. The 200 SMA is always a meaningful support or resistance in this market.
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Rather then speaking of the irregular stuff, I should mention that the end point of the bull phase culminating in the point { (v), ((v)), 1 } is the “orthodox” top of the market per Elliott Wave theory.
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Here is a larger view of the market context
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The last leg of this correction may well not be finished, despite the support from the trend lines and the 4h 200 SMA. Price action is also confined by the 50 hour SMA, that sits right on top. This has definitely created a triangle format, which may break down from its E-wave in a final wave, piercing support. The triangle is essentially complete, so this can happen within hours.
Numerous altcoins are in the finally stage of triangles too, apparently holding out for the finish by bitcoin.
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The wave down indeed occurred, but it was no danger to the support here. Immediately the first bullish wave emerged to the upside. This should end this correction.
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BTC has gained 2500 points since correction end ((Y)). The 200 SMA has held and the overhead 50 SMA was broken. The longer-term price channel it has been and will continue to trade in rises by about 585 dollars per day.
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Bitcoin has broken out of the constraint of the correction and completely exited the last triangular patter zone. It ha exceeded 69000 and topped the end of Minor wave one, which was the orthodox top of the proceeding bull run. This essentially confirms that it is trading in a new third wave of degree Minor. The target of the current subwave is right around the ATH.
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So, this was the story of the first significant ATH of the 2024 bull market. It was an irregular top driven past its orthodox Elliott wave end point by the greed of the market participants desiring a new all-time high, which in fact the completion of subwave Minute five could not provide.
A very similar pattern may also be observed in some of the meme coins that are hot currently.
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Since my initial post here about this structure, the market continued in a corrective manner. Turns out the initial structure added a triangle. This is discussed I in this new topic:
@BigBitsIO, Thank you. There is not a single analysis anywhere that I have come across that has taken the time to present this detail and understanding of this important chart milestone of Bitcoin. With the importance of Bitcoin worldwide, one would think that people would pay attention to detail, and apply EWT the way it was meant to be.
handyrams8
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thanks for the analysis. do think the 200sma will break down soon or hold as strong support?
unbeldi
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@handyrams8, The 4H 200 SMA has supported Bitcoin well the entire run since end of 2022, and was only broken during the correction in January to 38.5 k, after which the line was rapidly recaptured. So, my guess for the future is that this should continue for a while. You can chart the 50 SMA against it to get some warning about possible serious breakdown.
This brings up an interesting aspect about this correction. The fact that the 4H 200 SMA was not broken this time, tells me that this was a minor correction, not the doom and gloom that many are talking about. I am assigning it as a minor degree wave two, which will eventually be visible just as a shoulder on the side of this ascend.
unbeldi
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@unbeldi, Well, averages have the property that prices always return to them, and eventually break them and spend time on the other side. So, yes, it’s not something to be complacent about.
handyrams8
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@unbeldi I would not get too complacent. I notice the price has already been twice rejected off that 4h 50sma you mentioned. thanks again and I'm now following.
handyrams8
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@unbeldi correction, thrice rejected during this correction.
unbeldi
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@handyrams8, oh I was actually wrong about the 4H 200 before last summer. I should have said since September it wasn’t broken. But in any case, it is an excellent indicator.
handyrams8
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@unbeldi I knew what you meant. I knew to be long all through 2023 anyways when most people were still too traumatized by 2022.