Hi traders.
What is happening?
BTC seems to be losing momentum on the way to the inverted H&S target, which is also the touchpoint E on the triangle. Particularly the EW count on lower timeframe is out of sync so that we can re-evaluate the scenario.
Where do we go from here?
It is not unusual that price fails to reach point E, so we can look at the ratios to determine where price could reverse instead:
Regular contracting triangle: E=61.8% of D
Running triangle: E=78.6% of D
Should BTC break down from here, it is possible that we are completing a Wave 4 correction. Wave 4 often take the shape of triangles. In that case we have not completed an ABC correction from the ATH but in fact are near the end of a Wave A, with 1-5 motive subwaves down.
How to trade it?
The red box marks the 61.8 of wave D. The idea is to short this area instead of point E on the triangle - because that might be too obvious. Remember whales have to trap liquidity in order to accumulate or distribute. We can then speculate that price makes one lower low, which is the 5th wave.
Because Wave 3 is extended, we add the length of wave 1 to wave 4 (in arithmetic) or take 161.8% of wave 1 and add it to wave 4 (log chart). Look how price already responded to the previous two levels of this fib pull! Both targets are almost identical. The target is marked with the green box.
What if not?
If price breaks the triangle to the upside, it will head straight into the next resistance. If Bitcoin can break above it, we can assume that the ABC correction was valid and that the current pattern was a Wyckoff schematic 2 re-accumulation like initially thought, and we can look for pullbacks to buy into the uptrend.
Happy trading!
What is happening?
BTC seems to be losing momentum on the way to the inverted H&S target, which is also the touchpoint E on the triangle. Particularly the EW count on lower timeframe is out of sync so that we can re-evaluate the scenario.
Where do we go from here?
It is not unusual that price fails to reach point E, so we can look at the ratios to determine where price could reverse instead:
Regular contracting triangle: E=61.8% of D
Running triangle: E=78.6% of D
Should BTC break down from here, it is possible that we are completing a Wave 4 correction. Wave 4 often take the shape of triangles. In that case we have not completed an ABC correction from the ATH but in fact are near the end of a Wave A, with 1-5 motive subwaves down.
How to trade it?
The red box marks the 61.8 of wave D. The idea is to short this area instead of point E on the triangle - because that might be too obvious. Remember whales have to trap liquidity in order to accumulate or distribute. We can then speculate that price makes one lower low, which is the 5th wave.
Because Wave 3 is extended, we add the length of wave 1 to wave 4 (in arithmetic) or take 161.8% of wave 1 and add it to wave 4 (log chart). Look how price already responded to the previous two levels of this fib pull! Both targets are almost identical. The target is marked with the green box.
What if not?
If price breaks the triangle to the upside, it will head straight into the next resistance. If Bitcoin can break above it, we can assume that the ABC correction was valid and that the current pattern was a Wyckoff schematic 2 re-accumulation like initially thought, and we can look for pullbacks to buy into the uptrend.
Happy trading!
Trade active
Price hit our short target perfectly. The idea is still in place, as weakness continues. Meanwhile we are at chop central. Elliott waves are almost uncountable on the smaller timeframes. Patience!
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.