JoshThomas04

BTC - DON'T IGNORE HISTORY!

BITSTAMP:BTCUSD   Bitcoin / U.S. Dollar
With a lot of hope returning to the crypto space, the people are calling this the next bull run and analysts calling this a sucker rally and we are due to plummet imminently. I see the reasons for both sides but I’m playing it in the middle. Whenever a majority crowd are calling in one direction, the chances are it’s not going that direction. This along with some cold TA leads me to the conclusion: we could see a bull trap at $10,500 in May/June and drop to find our bottom at $4,000 in September/October. Let me break it down for you.

In wave ((II)) of the grand supercycle (the Dec ‘13 - Jan ‘15 correction), we retraced down 3 waves, (a), (b), (c), as shown below (log scale). The first wave (a) crashed down in waves I & III and then declined more gradually in wave V. This wave ended between 61.8% and 78.6% retracement levels of wave (I). Here, the SMI was turning up from the oversold area. This is where we had one massive spike upwards. This was wave a of wave (b) and found resistance at the dotted resistance line (remember we are using LOG scale). Price then broke this resistance line and completed wave (b) at the 61.8% retracement of wave (a). Then from here we had another 5 waves downwards to complete wave (c) and our correctional cycle was complete!



In wave ((IV)) of the grand supercycle, the correction cycle we are in now, we have retraced 1 wave so far which I have labelled (a). Wave I & III crashed down and then declined more gradually in wave V in a truncated fifth (this is just a fifth wave that doesn’t moved beyond the third wave). This wave ended between 61.8% and 78.6% retracement levels of wave (( III )), the 2017 bull run. Here, the SMI is turning up out of the oversold area and we have had a massive spike upwards, just reaching the dotted resistance line as shown below.



Notice the similarities here? I see analysts saying we are heading down imminently but I don’t think we can find a bottom so soon. The last correction was 413 days! I’m not saying this correction will be as long but it sure needs some time if we are gearing up for fifth wave. I have projected 280 days based on countertrends taking half the time to complete as normal trends and wave (c) being the same length as wave (a) in wave ((IV)). In Elliott Theory, wave 2 is almost never the same as wave 4 but here we are following it one step at a time. Maybe we could see a variation in the form of a double zigzag .. Who knows. I’m going to follow my idea until I see evidence of a deviation, then we can say history ISN’T repeating itself as it usually does. What are your plans for the months ahead?

Thank you for taking you time to read this! Please feel free to comment or ask questions. If you feel like this added value to you then please give it a like/give me a follow!

You can follow me through this link -> https://www.tradingview.com/u/JoshThomas...
Comment: Looking at where we are now, it looks like wave a has completed or is close to it. Our first target from the 261.8% extension of wave ((1)) coincides with previous resistance levels and we are pretty much there now. At this point we have also reach the resistance line from the two previous highs and the SMI & RSI is overbought. Beyond that, we have the 161.8% extension of wave ((3)) however I don't think we will reach it with this resistance that we've just run into.

Next I am looking for a pull back to the 50% - 68.2% retracement levels to keep this bullish momentum going. There is strong support at $7700 and I have seen a lot of traders preparing an entry point here so this level could be bought up very quickly! The dashed channel line gives us a good expectation of where we can see a reversal. Keep your eyes peeled!

Good luck trading guys!

Comment: BTC is forming a nice triangle at the moment. Thanks @Acel for the heads up! We should be breaking from this soon as we are so close to the apex.

If we break upwards then it would look like we are entering a 5th wave as shown below. On the up target we have a lot of resistance which could stop the breakout from reaching the target.



If we break downwards then I would be leaning towards this being the end of the fifth wave and more downwards action to continue.



Only time will tell!
Comment: So we've broke up from here but it is not a good place to go long. There could still be room to day trade with $9370 target but there is heavy resistance here. BTC doesn't seem to care about resistance though!!

Comment: and there's $9370!
Comment: We blew past $9370 in a parabolic move to $9800! This has the characteristics of a fifth wave all over it as volume was also declining at each high and, on the daily chart, we are overextended on SMI and bounced off the overbought zone on RSI.

This leads me to believe we are more than likely completing our wave a in the chart above and going to retrace 38.2%-61.8% of this move.

Comment: One thing I'd like to mention is the strength of the bulls.. Time and time again we have rallied even though indicators are overbought and we've reached extension targets etc etc etc. What I'm saying is, we might not see the retracement down to the levels shown above but that is my opinion based on my analysis. I am just super cautious this time because of the incredibly bullish sentiment however I must stick to my plan!

I've started to build a short position at $9500 and will add on if bearish momentum is confirmed. We are testing previous resistance as support now (red circle) and the first target for me is to fail to confirm this as support and break through. The next barrier to break is the blue rising trendline. Confirmation of this is the final place I will add to my short.

Comment: oops wrong chart again XD

Comment: Well it looks like we have completed our first bearish wave and the countertrend movement wave ((B)) ended at the 0.382 retracement. This quick drop is expected due to the built up bearish anticipation. I don't expect the bulls to be scared of this and they are most likely eyeing up entries as we speak!

I've shown a few targets for a reversal on the chart below and most seem to point at the $8100 - $8200 area which also coincides with the previous resistance, the dotted downtrend line. This is an important level to hold for bulls to keep the momentum, they do not want to be re-entering that channel!!!

Let's be ready to act with a plan and conviction!!

Comment: Another scenario that I'm looking out for is if we hadn't completed wave ((A)) and ((B)).

The H&S pattern on the hourly chart shows a target where we are hovering around now. This could be an area that bulls are looking at to enter and try push the price up, entering wave ((B)).

Comment: So Bitcoin went with my second scenario and it looks like we are seeing some resistance at the neckline and the previous support from that ascending wedge.

We can clearly label this as five waves which is interesting. I was expecting a 5-3-5 to this area but maybe we are seeing the first leg of the next bullish wave already? The higher we rally, the more likely this is to be. My plan tells me we should expect a reversal around these areas though so I am sticking by it until it is invalidated.

Good luck trading guys!

I dont care if we go up or down, but I do see that its a problem if bitcoin breaks up from an ascending wedge with declining to no volume...
Reply
JoshThomas04 BrettduPreez
@BrettduPreez, It's a sign that FOMO is still running the market and potentially, we didn't shake out enough bulls for this to be the bottom. It's definitely a weak move here.
+1 Reply
love it bro
pls post everyday
pls lets go down to 3k lol
Reply
@leorio, haha thanks man! I'll keep you updated as much as possible!
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