This chart is based on the wider macro picture I'm projecting in the linked analysis.
1. BTC is still in the C Wave of an ABC correction.
2. Analysing this ABC correction using a seven-wave crash structure analysis can give us projections of where the base could come in.
3. At the macro level, there are two projections, and a range in-between: 21.4k and 16.9k. Note that I'd be talking here of "evil wicks". I wouldn't expect these levels to be offered for more than a matter of seconds.
It's also possible that these levels are not visited at all.
4. In this chart, I'm looking closer at Wave 7 of the seven-wave crash structure. Within Wave 7, the seven-wave crash structure is repeated. BTC is currently, in my view, printing Wave 5 of that sub-structure within Wave 7. Wave 5 is the largest of all the waves.
5. Using a Fibonacci sequence, we can try to confirm the base when we see where Wave 5 lands. Either on the 0.702 taken from the beginning of this sub-structure, or the 0.786 of the same.
6. So the levels I'm looking in the near term are 24.5k and 25.9k. Depending on where BTC finds support and a bounce up to then print Wave 6, we can project where the final sub-structure Wave 7 might bottom out.
Again, these levels are 21.4k or 16.9k.
7. Wave 6 rolls up and should stop somewhere between the 0.382 and 0.5 Fibonacci taken on the projected base and the top of Wave 4.
8. We roughly have another 4 days from time of writing to see this all play out, IF it plays out at all. Remember: the only thing that BTC can't do is go left.
9. Please consider this chart only in conjunction with your own analysis. I've been wrong many times in the past on BTC , and I might be wrong now.
Feel free to comment.
Please see the linked analysis.
The orange line is the 34 weekly EMA , which BTC just penetrated to the downside.
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23 May 2021 16:16:49: Important to underline that this chart is near or short-term. It would be a separate question of where could be the bottom of a bear market if BTC doesn't dramatically recover when the next lowest low is in, and starts trading again above the 34 weekly EMA, recovering other key EMAs. We have to see where Wave 5 comes in, if the breakdown continues, to estimate the base. But in this market, also, which I think is on the edge of panic phase, these levels could be overshot, too. There's not much difference between a Wyckoff accumulation phase and a prolonged bear market when all key EMAs are above price action. nonetheless, The Ichimoku cloud on the monthly is still in the green, so we cannot make conclusions yet. But I wanted to underline that the next lowest low is not necessarily the lowest low that will be offered in BTC's foreseeable (i.e., medium term) future.
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23 May 2021 16:29:51: It does have to said, nonetheless, that the signature on the weekly Ichimoku does look like a blow-off top of sorts, rather than a correction as such.
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24 May 2021 13:01:05: I still suspect we'll see a roll down over the coming days, though perhaps not today. Watching price action these last months, I do become wary, yet I'm trying to keep an open mind. It's hard to say if what subsequently we might see as a bull trap or fake out was conscious price action in any sense, or perhaps some inexplicable repeating pattern that plays out in markets rather autonomously. At any rate, the current roll up does have the signature of Wave 6. Is it possible that Wave 5 is in, albeit radically truncated? Yes, it is possible — or I would expect it is possible. Perhaps crash structure wave patterns become condensed, or shortened, at reversal points, or support zones. It does make sense for 30k, more or less, to hold. That all said, this moment reminds me of the slow sideways and up action we saw before what I'm counting as the macro Wave 5 came in, which was far more severe than what these sideways moves would prefer one for. If some kind of shortened sub-wave 5 is in, and sub-wave 6 is being printed, by all means there will be a downside move, into the area of the red ellipse marked. This would be far shorter than any projected base take from the Fibonacci on the macro Wave 5. Currently all we can do is observe.
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24 May 2021 13:21:47: Meanwhile, zooming out doesn't reveal a bullish picture.
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25 May 2021 18:16:25: Yesterday saw a green day that appeared to give hope that the bottom is in. But to me this remains questionable, even though the immediate structure of the downtrend was forced sideways, and certainly as veered outside of the timeline projected in the main chart above. It's clear that we're in a reversal zone, or edging close to one, in my view. But if we flip to Heikin Ashi candles and isolate and compare Wave A and Wave C, which should essentially follow the same structure of seven waves, to me I'm unconvinced that it's over yet. I think we're currently in the zone of Wave A circled. We haven't seen a convincing bounce yet. Today's price action underlines that. I cannot rule out a shorter reach down. But if Wave C is to mirror the same general pattern of Wave A, I still see further downside likely.
Note number nine was great, showing your professionality.
ponzialchemist
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Detailed analysis, thumbs up!
cheeseclock
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I agree that it doesn't look bullish, but the sentiment on social media is a lot of "it's over", "to the moon", and "I told you so". Arguably, I could have made money yesterday and today, but my gut says stay away. I may regret that. I may not.
My understanding is that the 5th wave can come in truncated. It's not such a far fetched idea. I guess we'll see soon enough.
ianrdouglas
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@cheeseclock, For me, either way, right or wrong, I'm building experience. Few get to ride the train from the bottom to the top, and what I've found anyway is that shorter moves, followed by exit, consolidation, re-entry, are potentially more profitable than longer buy, hold, exit trades. So right now, I don't mind being on the sidelines, though I didn't like 25 March to late April period when I was also sidelined amid uncertainty. It's very hard. And I have to balance risk with the simple insight that no one pays me to read charts. At some point, you do need to buy into risk. Currently, I'm observing. Neutral in terms of direction, Will reassess if BTC gets back above the 21 weekly EMA. Even then, my guess is that we'll be range bound for a while, at best.
cheeseclock
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@ianrdouglas, I am essentially doing the same. I did nearly add funding to the exchange yesterday at the bottom (for now). I appreciate the work you've put in. It's far more accurate than mine to date. What I'm truly confused about is how it can sit below 200 MA and the market is still called bullish by many. It's not like stocks. I stayed in through the March/April run. I got out near the top, but decided to go all in at perceived bottom (BTC 42k). It was a gamble and I got my hands slapped. I got out during the bounce back up, but still lost much of my profits. I'm following out of curiosity at this point. Barring a crazy parabolic trend, I think I'm done for a while. I will likely DCA in during the upcoming bear market though and take profit before things get crazy.
ianrdouglas
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@cheeseclock, I'm still processing Wednesday. But I guess not only Wednesday, but what the hell I was thinking to try to ride a BTC correction down while holding alts. I think earlier I felt that this would all be relatively simple. Buy at good prices, and then hold and trade up. Be careful about corrections, but don't panic sell your bags either. Well, that's okay amid 30-35% corrections in a continuing bull market. But 54% on BTC really breaks that strategy, and I should have hedged or rotated, or at least done something to lock-in the longer term profits that I just saw dwindle to below zero across my portfolio combined. And yet I had so much warning, dating way back to 18 April. I was stuck with that theory that alts might benefit from a lagging BTC, all the while absolutely aware that when BTC bleeds, alts dip too. And then Wave C started, and the model I was looking to see unfold - the rotation into alts - just didn't happen, and at some point I just had to sell, in case we are entering a months-long bear market. So I make realised my losses, which is the last thing I wanted to do. And which was totally avoidable. Misjudging my own wave count and longing into 40 was the fatal error that made this unavoidable. It will haunt me for a good wile. Meanwhile, we can see on the chart now how things don't wants unfold as we think they should. It starts to really look like a v-bottom out of there. The uncertainty continues. Is it a bull trap? Or is time passing and the best entries we might get fading? I need at least a momentary break. It becomes both tedious and dangerous in equal measure. I know why some give up, leave, drop it all, sell it all. It has been savage, and I think it sure dented my enthusiasm.
cheeseclock
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@ianrdouglas, I understand your frustration. I really do. At this point, my own cognitive bias is screaming market manipulation, but it could be just that; my own bias. I also share the sour sentiment towards the market at the moment. Maybe in a few days it will bear itself out, but as the guy who taught me stated: "One day doesn't make a trend". I admit to schadenfreude when I'm looking for a dead cat bounce. I want to be vindicated. It doesn't always work that way.
A V-bottom could happen, but it doesn't seem reasonable unless the whales were just filling their bags and are going to let it run up again. Enough people were whacked (over 1T USD in value), that I can't imagine they're clamoring to jump back in, but we live in strange times.