Hey folks, we seem to be moving up in a very healthy and bullish manner. I believe we're in an expanding 1st wave diagonal. All indications are that we are in an uptrend and it is not ending anytime in the immediate term. The first test will be at 10.2k, which we will most likely be rejected from. Beware, on the retrace we may fall through support and retest or break the 7k level and that would confirm that we are in fact NOT in an uptrend but in a 3 wave bullish correction of the larger uptrend.
If you are aggressive you can add on the dip. If you are careful you will wait for the rebound and add on the way back up.
Upside Target: T1 9.6k T2 10.2k
Re-entry or Add: T1 9.1k T2 8.8k T3 8.3-8.4k
These zones are verified by areas of massive support/resistance from the earlier downtrend. Also I hear a lot of fear regarding the Death Cross. Moving averages are a lagging indicator, daily ones more so. Primarily they are there to confirm a trend, in this case bearish , which we already knew. If we are able to break above 10k within the next week or two then they will recross. It is vital, however that we break the downtrend line from 20k if not on the first attempt then at least holding above 7.8k on the retracement, and breaking it on the second attempt.
Scale into your positions, manage your risk, and use stop losses. Cheers!
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Here's an alternate count that could play out as we speak.
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RECOUNT!!!
I think I have been overcomplicating things. As we get closer to completion of the 1st wave, it's beginning to look more clear.. and more bullish!
4 can't overlap 1. When mapping your ABC off of the 3rd wave you have to set your fib retracement tool to wave 2 low not start of entire upswing bc you are only retracing wave 3, not the entire 5 waves up like after wave 5 which is where you measure from the start of wave 1 like you did here.
DennisLeeBTC
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@BullWick, You're right about the retracement. I should have measured only for wave 3 and instead was showing the retracement for the entire 5 wave sequence. Either way it seems like that count is not playing out.
You are however mistaken that 4 cannot overlap 1. It does, and often does so in leading and ending diagonals where the length of 1 > 3 > 5. elliottwave.net/educational/basictenets/basics2.htm and also in the book "The Elliott Wave Principle" by Prechter and Frost.
DennisLeeBTC
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@DennisLeeBTC, Sorry I see now what you're talking about in the 3rd wave. Yes you're right, you can't have a diagonal in the 3rd. I wrongly mislabled the ABC correction from the 3rd instead of the 5th. Apologies.
BullWick
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@DennisLeeBTC, you were right the first time...as these are subwaves of wave 1, which can be a diagonal, overlaps may occur. I like that book too ;)