Hi traders!
According to our EW count the end of Bitcoin's correction could be near.
Where are we now?
Our last short has worked out perfectly and on Friday we have completed 5 waves down.
We can interpret this 5-waves move as a larger wave (i). In this scenario we still have 2 more large motive waves down, likely sub-30k. This is the bearish scenario, marked in red: (i) to (v). It will complete the entire correction from the ATH, and after this, we can expect a lot of mooning towards new highs - maybe even for the rest of 2021. This is my assumption and it aligns with the previous analyses of BTC and ETH. It would also be an epic buying opportunity.
In the bullish count, this 5-waves move is an A, and we are currently in wave B, followed by a C with another 5 sub-waves down (green illustration). In this scenario we will not see any lower lows, but a lot of ranging and ultimately a very strong move to the upside which could (potentially) mark the end of the correction - but it would be a more complex scenario overall.
How to trade it?
Because the previous 5 waves down were clearly impulsive, the bearish scenario has a high probability. We can look for a retracement into the fib levels (red boxes) and attempt a short that will catch the large wave (iii) downwards. In the bullish scenario we are currently in a wave B and buy the dip, once we identify the wave C that consists of 5 sub-waves with a slow, sideways character. If price comes crashing down, we know it is the wave (iii) of the bearish scenario, and obviously we will not long that.
Thoughts on Correlations
Crypto is somewhat correlated with the Nasdaq and inversely correlated with DXY. Both are currently not very helpful for crypto bulls. For the bullish scenario we would need the Dollar to pause its uptrend and the Nasdaq to go higher - or at least keep ranging. Read my other analysis why I believe the Nasdaq could make a leg down, before another (final) bullrun in late summer or autumn that could be followed by a gigantic bear market.
Happy trading!
According to our EW count the end of Bitcoin's correction could be near.
Where are we now?
Our last short has worked out perfectly and on Friday we have completed 5 waves down.
We can interpret this 5-waves move as a larger wave (i). In this scenario we still have 2 more large motive waves down, likely sub-30k. This is the bearish scenario, marked in red: (i) to (v). It will complete the entire correction from the ATH, and after this, we can expect a lot of mooning towards new highs - maybe even for the rest of 2021. This is my assumption and it aligns with the previous analyses of BTC and ETH. It would also be an epic buying opportunity.
In the bullish count, this 5-waves move is an A, and we are currently in wave B, followed by a C with another 5 sub-waves down (green illustration). In this scenario we will not see any lower lows, but a lot of ranging and ultimately a very strong move to the upside which could (potentially) mark the end of the correction - but it would be a more complex scenario overall.
How to trade it?
Because the previous 5 waves down were clearly impulsive, the bearish scenario has a high probability. We can look for a retracement into the fib levels (red boxes) and attempt a short that will catch the large wave (iii) downwards. In the bullish scenario we are currently in a wave B and buy the dip, once we identify the wave C that consists of 5 sub-waves with a slow, sideways character. If price comes crashing down, we know it is the wave (iii) of the bearish scenario, and obviously we will not long that.
Thoughts on Correlations
Crypto is somewhat correlated with the Nasdaq and inversely correlated with DXY. Both are currently not very helpful for crypto bulls. For the bullish scenario we would need the Dollar to pause its uptrend and the Nasdaq to go higher - or at least keep ranging. Read my other analysis why I believe the Nasdaq could make a leg down, before another (final) bullrun in late summer or autumn that could be followed by a gigantic bear market.
Happy trading!
Trade active:
Intraday update: Re-count of wave 1. We are in sub-wave 5 now.
Trade closed: target reached:
Target reached today : )