Sorry for the messy chart...I needed to scroll back in time far enough to show the earlier demonstration on the same chart.
I've noticed how on big moves, they seem to play out in several phases, which seem to be mapped nicely by the indicator.
1 - Bounce Phase
The initial move down drops into the 'Bounce Level' zone from which it recoils and rallies back up.
This defines an initial low, but does not define THE low. It just provides an initial 'bounce'.
2 - Low Level 1
After price rallyies back up and fails, drops again, but this time, bouncing off of the 'Low 1' level.
This defines a lower price low than the previous one despite appearing LESS OVERSOLD than the higher low before.
I like this as it demonstrates how reading Oversold and Overbought levels in BTC imo is totally pointless :-)
3 - Low Level 2
After bouncing off of the 'Low 1' zone the rally fails again and this time finds yet another low, this time at an even less oversold than the previous low.
Looking at the current cycle, we have visited the 'Bounce Level' so far.
I'm seeing a failed rally in price and expecting a visit to the 'Low 1' level for a potentially more defining low than 276.
Measured move suggests a wave up from the 217-220 region.
I see a further potential low around 182/183.
Hope it plays out! :-)
I think many come under the assumption that by reaching so low we will see an influx of people coming back in. Yet that is generally not the case. There will be heavy support going down. Yet, average Joe investor isn't going to be all in. There is a reason it is called the pessimistic stage, and it's because many investors are worried. Worried we just won't recover, worried about the future. Let's get all the notions of "Bitcoin is great" out of our heads and think like average Joe trader. Joe may only have 5% total portfolio in Bitcoin so it is speculation. When you can think like other traders you can better judge the markets.
I don't think I answered the first question at stake. My levels are little variable being 220s right now.
uWhat we are in now is the exact opposite. Sure, it is more stretched out, but all downtrend happen in a greater time frame, for the most part, then bubbles. So, because we are pushing down so hard that means the prices are way to lower. People are not making emotionless decisions. They're selling for fear that because we have gone so low we may never recover. The opposite is true for peaks.
Side note, I'm typing this all on mobile so pardon any grammatical mistakes.