BITFINEX:BTCUSD turned up in an impulsive manner, where it can be unfolding five waves up away from lows, which would confirm a bullish reversal.
At the end of June BTC started to rise pretty sharply, so it's an idea that bottom can be place. As you can see on the chart, BTC already broke above trendline, but the most important is 261,8% Fibonacci extension of wave (1), which usually suggest a wave (3) instead of (C), so we asssume that BTC can be currently trading in a temporary correction of wave (4) that can be either a projected flat correction or it will just stay sideways in a triangle correction. In both cases we can expect more upside back above 8500 level. Based on time projection of wave (2) with 8 daily bars, we may consider something similar for wave (4), so sooner or later BTC may find a support.
However, according to bearish ALT coins, we think that BTC can see a deeper correction, which may test that red trendline as a support, right around 38,2% Fibonacci retracement of wave (3). One more thing is that wave (4) usually retrace back to a previous wave 4, so if we put together all these evidences, then be prepare for another decline into wave C of (4), where ideal support area would be between 7600-7200 levels.
Disclosure: Please be informed that information we provide is NOT a trading recommendation or investment advice. All of our work is for educational purposes only.
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BTCUSD just hit 7200. Watch out for a bounce here around 7200 - 7000! Bullish only if goes back above 7800 area!
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Bitcoin's bullish count was invalidated since we have seen a sharp decline and broken 6800 support level. So, we are tracking an ending diagonal now into wave 5 of (C), which should be completed within three waves a-b-c towards 5000-4000 area.
Well there goes your wave structure, all your fibs and imaginary trend-line support. :P
ew-forecast
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@diofonte, yep was wrong on that one, but I have no issues to adjust views if wrong. but at least catch up soon enough weakness on eth, bch and others. Anyhow btcusd can see 5k
@ew-forecast, No worried. I wasn't convinced even though in theory you are correct. Only because of the MACD, RSI etc on the daily chart had too much behind it to turn what seemed like the Titanic. Volume dropped quickly entering into the correction, as it would. But it seemed to me those committed pulled out faster given the SEC put the kibosh on ETF's. I know, TA guys shouldn't focus on noise. However, the herd does, and besides, if I neglect to look at other indicators it maybe that I miss something obvious that EW or the Fibs don't elucidate or augment. Your analysis as always was spot on from a EW TA perspective, of course. ;)
TomPower
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@ew-forecast, wow ok I am long in here, should have been aware of that 6800 invalidation, not knocking @diofonte but I've given up on the macd crap, EW is the one technique thats forward looking to some extent. it sure looks like a triangle as you've drawn it.
Gomez_Addams
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@TomPower, I understand the sentiment, I used to feel the same way. However, you cannot discount such things completely. Better to take the position of EW as the GPS or compass to where you are in the big picture climate. Indicators can help confirm or make more accurate the timing of the unfolding of events or its drivers. EW and Fibs should be the focus as it provides clarity on the bigger picture. But always take the 25,000 ft view into consideration (daily/weekly/monthly). Otherwise you can't see the forest for the trees, or the very obvious ;)