DanV
Long

BTCUSD - BitStamp, Intermediate Term Bullish - (Updated)

BITSTAMP:BTCUSD   Bitcoin / Dollar
19676 42 89
Since November 2013 High, we have been in wave (iv). Wave 4 are often complex. Well the price action has been complex since November high as can be seen by variation of my charts on Bitcons since then including the last one posted just 2 weeks ago.

However, overall whilst majority up to recently had been very bullish and were expecting to be in the region of 5000 by now, I have continued to maintain overall consolidation and bearish tone with conservative targets of retest of 340 or make new low around 280-260 zone. Many dismissed it and many clearly have made negative comments about my analysis. Often focusing on exactly where my line begin and end in terms of exact levels.

Whiles levels are important, is is not always possible to be so precise as some would expect form others when they themselves offer non except unhelpful criticism.

So this analysis is to be us3ed as general guide in the form of outline of the expected price action and where possible some levels which can be reinforced by some structure and fib relationship, but only as possibility.

In fact I am convinced that if any serious analyst was to focus on larger picture message then this my approach could be helpful. It has kept many from suffering massive drawdown or loss of profit by avoiding long position from November 2013 ATH             or entering new longs from those higher levels.

So as an update to last published chart, whilst the low expected has taken place at lower level, overall picture is still the same with minor variance.

This is now shown as Larger ABC zizgag with Wave C needing 5 waves. This is clearly now shown on chart as potential ending diagonal (referred to as 3-3-3-3-3), which has already began or is about to being wave (iv) in blue. Text Book schematic diagram is shown to help understand the overall pattern. The upside could be 480-500 zone

Should this outline develop then we could see another leg lower from 480-500 zone retesting the recent low or making marginal lower low for form around Mid December 2014. On completion of which a major new bullish cycle could unfold which might at least approach the November all time high or make new higher high.

To me that is the most significant message of this analysis with proviso that the Ending diagonal explained above forms.

You are free to disagree, but for serious analyst this might be of interest and take it for what it is. Hope you find it interesting.
http://www.danv-charting.com
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Close up on Daily time frame
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+1 Reply
Do you expect the (v) in blue to be in the "blue trend line" (the big trend line from at least 2012 ) ?
In other words, would "breaking" the trend line still make the interpretation valid ?
(I am thinking we can break it, and it will be still valid)
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DanV MOD doTheBounce
Minor breaches can be tolerated as long as it does not violate EW rules or guidelines. So in this whilst not ideal, it can break the long term trendlines for short time. ie this is weekly chart to may be 1-2 bars close below the line as long as it is not too far way and the bar closing low is still straddling the line. On daily time frame we could have several bars below the line and still turn out to be false break.
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Dan, ED's do normally show an over extension of the 5th. This pattern is also known as a Wolfe Wave, and one of the rules is that if you clone the trendline connecting (ii) and (iv) and place the starting point over the end of wave (i), you can estimate the range of said breakout or 5' point. In that case 5' would hit lower than the recent lows, right?
I like your interpretation of the wave count, very nice.
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IvanLabrie PRO IvanLabrie
Is it possible to see ending diagonals in this position? Or is this a normal triangle? Hence waves are a-b-c-d-e...I'm a bit confused now :p
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DanV MOD IvanLabrie
Good Question, thanks. Ending diagonals appear in wave 5 as you described and wave c in abc zigzag. hope this helps.
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Wave c...alright, makes sense now. Might be possible then, one thing is that the strange price action we see in bitcoin exchanges affects the trend line positioning to draw the wedge. Do you just go for the shadows or use the close in this case?
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This is exactly what I am expecting to happen as well. Although, we have made some strong support at 300 (due to large order being filled and the 7+ hr price flatline), I do see ~260-280 being a possibility for one last bear trap before it bounces up once again (and then descend thereafter).
+5 Reply
Thanks, as they say, great minds thing a like.
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My EW skills are weak, but any thoughts on this being an ABC correction on something like a monthly chart? I could see that stretching out to 5 wave move down because of the delays in NY State regulation guidance however.
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Hi Danv, this is coming from a newbie, but isn't your wave 3 from early july to mid October shorter than your wave 1 and 5, making it the shorted 'impulse wave'. I thought this is not allowed. Can you please explain why this is ok here?
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the.jedi.jones the.jedi.jones
*shortest*
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DanV MOD the.jedi.jones
Not sure if I follow you. But the entire price action from April 2013 high to Late Sept 2013 is part of wave iv. It is sort of triangle. Hope that clarifies.
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Any update on this prediction?
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Comment removed
Thanks for the update! :)
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DanV MOD LastBattle
YW
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11th November 2014 - Update: If the wave iv of C, we are moving in anticipation of a zigzag move up. If this is correct interpretation then it seem to me that we are in 3rd swing of the zizgag and which could reach the upside of 450-475 but could make slightly higher target before reverting to downside.
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+4 Reply
Many had lost heart and did not believe BTC could ever come up above 400 and the newly born bears were taunting anyone suggesting upside move calling to to 80. That of course was even worse than my bearish target. Anyway it seem that now it is a hurry to meet the 450 zone and may be could even spike into 480-500 zone. Then I suspect we will get many bears converted. hehehe
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+2 Reply
when the bears get converted, its dump-o-clock :)

Nice call overall.
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DanV MOD LastBattle
Hahaha, yes indeed. Thanks
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I agree with this one as well, but I would rather say that we will re-test again the classic ATH of $273, instead of going further down: we will see. As always, thanks for sharing such detailed charts.
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YW. As always willing to review when necessary. Thanks
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What a great chart, thank you for your analysis Dan!
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YW. Thankyou for your appreciation too.
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BTW, where do you think the next wave (v) could bring us to? Could you say something about a conservative and optimistic scenario? Something like 5.000 - 10.000? Or is it just too difficult still to say anything about this?
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Conservative would be attempt to retest the ATH but stopping short as 5th wave failure. Optimistic would be new high but nothing like 2000+. I know this might disappoint many and might get rotten tomatoes being thrown at me. But anything higher that that is just wishful dream right now. Not to say it will, never happen, but not to count on it.
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I agree that the most likely scenario is bitcoin not being able to go over $500 resistance and returning back to $275-$220. Too much resistance between $500-$700. In my opinion it is too early to break that levels without a better way for fiat to reach exchanges.

But don't you think that in case bitcoin goes over $1200, and taking into consideration that bitcoin is really emotional and full of believers, price could easily reach $3k-$5k in that bubble?
I could be wrong, but going above $1,200 to not go over $2k, seems extremely conservative in a scenario without bagholders.
+3 Reply
DanV MOD DoctorBitcoin
Like you said, BTC very emotional so one can never say never. However, this correction from Nov 2013 high has lasted long and retraced so much that I suspect many bulls have been taught some humility, reality and fear that things cannot just go one way. Hence I am not convinced that it could reach the higher limits. But as we have more price data to guide us I will be willing to review this for more accurate scenario. Thanks for your comments & qutions in the meantime.
+3 Reply
Houbi OKcoin Btcchina all spiking close to 3000 cny ....i would like to know if we will go to 500 ish from here for STAMP FINEX BTC E (i am CONFUSED) since CHINA according to charts already kissed 500 $ ALMOST .......... ....as mentioned before lot of resistance between 500 and 700 ... we will come down 200 -250 ...again what do i know ..i will wait for DANV analysis :P
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We might have the high in place (upside might just be a retracement now) Here is possible wave counts
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Hi Dan, any update? thanks
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BTCE
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So it all boils down to what happens here in this box. Either it follows RED bearish OR BLUE Bullish. Even then bullish is now limited. I think the high is in place.
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soap DanV
Looks like a RED :(
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Yes agreed. That also means that possible top is in place already. Will need to keep close eye to monitor shorter term price action for early confirmation.
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First, thanks for this chart ; I'm still discovering EW but some of your calls hitted very nicely and your charts are helpfull.

I've tried to do some wave counts and I was thinking "what if C (and (v)) already happened on 5th Oct ?"
Would it be a possible correct count ?

Also you stated "we could see another leg lower from 480-500 zone retesting the recent low or making marginal lower low for form around Mid December 2014."
Does this mean the last days $300 could be the end of ABC correction and marking the (V) beginning ?
Said another way : could the blue (v) only have hit $300, being above (iii) which was on 275 ?




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Hen0xyd Hen0xyd
For my first question, maybe it will be more clear with a chart :
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Thanks for your question. The bounce of October low is abc zigzag retracement of previous decline from your label c. that is not the start of a new bullish cycle which is what you would expect if you are correct. The decline since Nov high is part of the final leg and is relatively too small for it to be acceptable wave 5 of c on my chart. Mid Dec date was anticipated as earlier possible low some time ago. Clearly that has not happened yet so the final low is likely to be some time in Jan/Feb. So we need to wait for this last cycle to complete.

Also the labels you are proposing as part of wave C has been suggested by quite a few analyst when the Oct low was being formed and were expecting new bullish cycle which I do not feel is the case. Some have even suggested that the abc zizgag of the ow is in fact 1,2, i,ii sequence of new Bullish cycle. This has been now shown to be incorrect.

Hope this helps.
+1 Reply
Yes, this helps, thank you Dan for answering to an EW beginner like me.
I need to learn/practice more to be sure I understand correctly advanced counting, sequences and consequently some of your remarks. Still I think I understood most of your comment :)
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Great, I am pleased.
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Dan, you see a retest of 305/310 coming now? http://i.imgur.com/auANEH1.png
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Whilst no guarantees could be given, there is likelihood of possible retest of 300 at least if not higher,
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