Its a dead cat bounce
Updated
Elliot waves and chart patterns seemed complete at the 6105 low. We are seeing articles on seeking alpha recommending now as a good time to buy in. This sentiment has lead to the footing BTC has made in the last few days (the orange triangle); however, it is only temporary. BTC has been putting in 30 day cycles pretty regularly starting on the 6th of each month. The current cycle starting on June 6th put in its high at 7777. We can expect an ongoing downtrend through the remainder of this current 30 day cycle ending near July 5th.
Once BTC breaks below 6105 USD the "dead cat bounce" will be confirmed. We can then expect the downtrend to duplicate the previous bearish impulse. Therefore take the 7777 high and subtract 6105 and we see the downtrend should complete near 4433 USD. BTC will find ample support in this zone and it is near the .786 Fibonacci retrace of cycle degree wave 1.
Here's how I came up with the chart:
The May and June downtrend has formed a column seen in yellow. The top green line (unimportant) is the bottom line of a large invalidated bear flag. The upper dark topaz line is the bottom support line of the large triangle extending throughout 2018, which I found via the Bitstamp chart. The lower light topaz line is similar but found on the Bitfinex chart. The Bitfinex chart having large candlewicks has caused the line to be lower. Interesting I have found the Bitfinex chart to observe both lines. For example the 6105 low hit the bottom line exactly and at least one candlewick inside the orange triangle hit the upper line exactly. We see the orange triangle has apex exactly at the top of the yellow bull flag column. We can expect the coming downward impulse to start near the apex which is June 4th. I am expecting a bounce at the lower trend line, and then a 38.6% retrace to the top line. I have been seeing June 27 to June 28 as a date of interest in the crypto-space. I have therefore set the bottom of wave 3 to be on June 28th at the bottom trendline of the yellow column. I have then made a dragged out wave 4 and a quick wave 5 to finish the impulse on late July 5th. Wave 3 and 5 is 1.618 wave 1 and wave 4 is 23% wave 3.
In the end we see this elliot wave pattern corresponds with the dead cat bounce expectations, bottoming out at 4486 USD. If we see this happen I expect to see a MACD that is very over sold, and likewise see a sharp quick snap back upwards in price. Interestingly BTC has been showing for over a month now as early July to be the apex of the contracting MACD.
If you are new to this and care to short the dead cat bounce, then here is how: tradingsim.com/blog/dead-cat-bounce/
I personally plan to simply hold Tether until it hits bottom, as I have increased faith in Tether regarding this news: newsbtc.com/2018/06/20/report-tether-does-have-enough-dollar-reserves-to-back-all-usdt-in-circulation/
Once BTC breaks below 6105 USD the "dead cat bounce" will be confirmed. We can then expect the downtrend to duplicate the previous bearish impulse. Therefore take the 7777 high and subtract 6105 and we see the downtrend should complete near 4433 USD. BTC will find ample support in this zone and it is near the .786 Fibonacci retrace of cycle degree wave 1.
Here's how I came up with the chart:
The May and June downtrend has formed a column seen in yellow. The top green line (unimportant) is the bottom line of a large invalidated bear flag. The upper dark topaz line is the bottom support line of the large triangle extending throughout 2018, which I found via the Bitstamp chart. The lower light topaz line is similar but found on the Bitfinex chart. The Bitfinex chart having large candlewicks has caused the line to be lower. Interesting I have found the Bitfinex chart to observe both lines. For example the 6105 low hit the bottom line exactly and at least one candlewick inside the orange triangle hit the upper line exactly. We see the orange triangle has apex exactly at the top of the yellow bull flag column. We can expect the coming downward impulse to start near the apex which is June 4th. I am expecting a bounce at the lower trend line, and then a 38.6% retrace to the top line. I have been seeing June 27 to June 28 as a date of interest in the crypto-space. I have therefore set the bottom of wave 3 to be on June 28th at the bottom trendline of the yellow column. I have then made a dragged out wave 4 and a quick wave 5 to finish the impulse on late July 5th. Wave 3 and 5 is 1.618 wave 1 and wave 4 is 23% wave 3.
In the end we see this elliot wave pattern corresponds with the dead cat bounce expectations, bottoming out at 4486 USD. If we see this happen I expect to see a MACD that is very over sold, and likewise see a sharp quick snap back upwards in price. Interestingly BTC has been showing for over a month now as early July to be the apex of the contracting MACD.
If you are new to this and care to short the dead cat bounce, then here is how: tradingsim.com/blog/dead-cat-bounce/
I personally plan to simply hold Tether until it hits bottom, as I have increased faith in Tether regarding this news: newsbtc.com/2018/06/20/report-tether-does-have-enough-dollar-reserves-to-back-all-usdt-in-circulation/
Note
I've seen other people count this WXY pattern such that Y is ending where you would see on my count as wave 2 of B of Y, where on my count Y is a 3,3,5 flat. If you put Y up there a that high point on June 19th then you can count the latest downward action as wave 3 and say that wave 5 will end in the range of 5700 if wave 5 is 1.618 of wave 1; however, this wave 3 is would not be jiving well with fibonacci ratios and I don't see that as the correct call.
As my count shows, this downward wave that just happened is just wave 1. That will make for an extremely severe bearish waves 3 and 5, where in the most extreme case I could see is wave 5 as low as 2800. My primary at the moment has it at 4050 on July 5th.
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