There are a confluence of indications that we have established a bottom. I very much hesitate to say this as it puts my reputation on the line, but I will outline my reasons in the following analysis.
As a preface, I want to make it clear that charting Elliot Wave corrections is very complicated as there are over 20 possible counts and my use of Elliot Wave and/or my count could be off. That said, Elliot Wave charting is largely a subjective art form tempered by some math here and there... IMHO.
However, used together with other tools, Elliot wave helps project the end of an impulse waves, and that is largely my goal in using Elliot Waves, so I can better judge when to exit or re-enter a position.
There a couple of Elliot Wave fundamental tenants I should outline here:
1. Wave 2 can never go below the beginning of Wave 1 or it invalidates the count. At 0.54 we have very nearly reached that point.
2. Elliot waves very reliably react to Fibonacci points. In a correction wave $XRP has consistently demonstrated that it will react to the 0.362 or 0.50 levels... but in the lesser degree wave formations. The purple wave 1-2-3 is the highest degree (Cycle) Elliot Wave visible in this chart. There isn't really enough data for me to see a pattern in that degree. However, in the lesser degrees, the Primary (numbers inside circles) and the Minor (numbers without circles) waves use of 0.362 and 0.50 fib has been very reliable.
3. Wave 2 and 4 predictions are based on the 0.362 fib of Wave 1 or 3. Wave 1 is not really predictable IMHO, but Wave 3 has often extended to the 1.272 fib. Wave 3 is normally is the larger of the impulse waves, but its not uncommon for Wave 5 to be the largest. In plotting a prediction I have used 1.272 as the extension based on previous patterns.
4. The predictive Minor wave should repeat 3 times within the 3rd Cycle wave (purple), which is plotted at the 1.272 and is very near the 1.20 resistance level Ive had plotted for a few months now. Each Minor formation completes 1 Primary impulse wave.
5. The current Minor wave, of which 1 and 2 is established, would be invalidated should the price fall below Wave 2 again.
With the overly complicated Elliot Wave analysis out of the way, the 4H RSI bearish trend-line from 0.96 has been broken. In addition, the last low, 0.54 was 0.01 from the Monthly S1 Pivot Point, as well as just passing the 0.764 fib of the 0.45-0.96 move. The 0.54 level has been a reactive support and resistance level prior to the move from 0.45.
Another item that I have been studying is Long Open Interest. Since the 0.54 low, LOI has gained 2.5 million and has made higher lows and higher highs, a bullish sign. For the first time since May 8th, LOI has passed above the 50 EMA and is approaching the 100 EMA. I don't consider LOI a particularly reliable indicator yet, but I have been drawing correlations between LOI and XRP performance which shouldn't be surprising as its just another way at looking at money supply.
Watch the descending trend-line marked in red from 0.96. I think that could very well be the first Minor correction wave starting area depending on how long it takes us to get up there.
The rate of gain from 0.45-0.96 was 55 degrees. I used this rate of gain again to plot Wave 3 of the Cycle Wave ending at 1.20.
As always, this is my personal observation and analysis of the market and is not intended to be trading advice.
For future updates to this Analysis follow me here, or if you want to get more up-to-date updates to price action follow me on Twitter @ExsiliumI.
As a preface, I want to make it clear that charting Elliot Wave corrections is very complicated as there are over 20 possible counts and my use of Elliot Wave and/or my count could be off. That said, Elliot Wave charting is largely a subjective art form tempered by some math here and there... IMHO.
However, used together with other tools, Elliot wave helps project the end of an impulse waves, and that is largely my goal in using Elliot Waves, so I can better judge when to exit or re-enter a position.
There a couple of Elliot Wave fundamental tenants I should outline here:
1. Wave 2 can never go below the beginning of Wave 1 or it invalidates the count. At 0.54 we have very nearly reached that point.
2. Elliot waves very reliably react to Fibonacci points. In a correction wave $XRP has consistently demonstrated that it will react to the 0.362 or 0.50 levels... but in the lesser degree wave formations. The purple wave 1-2-3 is the highest degree (Cycle) Elliot Wave visible in this chart. There isn't really enough data for me to see a pattern in that degree. However, in the lesser degrees, the Primary (numbers inside circles) and the Minor (numbers without circles) waves use of 0.362 and 0.50 fib has been very reliable.
3. Wave 2 and 4 predictions are based on the 0.362 fib of Wave 1 or 3. Wave 1 is not really predictable IMHO, but Wave 3 has often extended to the 1.272 fib. Wave 3 is normally is the larger of the impulse waves, but its not uncommon for Wave 5 to be the largest. In plotting a prediction I have used 1.272 as the extension based on previous patterns.
4. The predictive Minor wave should repeat 3 times within the 3rd Cycle wave (purple), which is plotted at the 1.272 and is very near the 1.20 resistance level Ive had plotted for a few months now. Each Minor formation completes 1 Primary impulse wave.
5. The current Minor wave, of which 1 and 2 is established, would be invalidated should the price fall below Wave 2 again.
With the overly complicated Elliot Wave analysis out of the way, the 4H RSI bearish trend-line from 0.96 has been broken. In addition, the last low, 0.54 was 0.01 from the Monthly S1 Pivot Point, as well as just passing the 0.764 fib of the 0.45-0.96 move. The 0.54 level has been a reactive support and resistance level prior to the move from 0.45.
Another item that I have been studying is Long Open Interest. Since the 0.54 low, LOI has gained 2.5 million and has made higher lows and higher highs, a bullish sign. For the first time since May 8th, LOI has passed above the 50 EMA and is approaching the 100 EMA. I don't consider LOI a particularly reliable indicator yet, but I have been drawing correlations between LOI and XRP performance which shouldn't be surprising as its just another way at looking at money supply.
Watch the descending trend-line marked in red from 0.96. I think that could very well be the first Minor correction wave starting area depending on how long it takes us to get up there.
The rate of gain from 0.45-0.96 was 55 degrees. I used this rate of gain again to plot Wave 3 of the Cycle Wave ending at 1.20.
As always, this is my personal observation and analysis of the market and is not intended to be trading advice.
For future updates to this Analysis follow me here, or if you want to get more up-to-date updates to price action follow me on Twitter @ExsiliumI.
