Bitcoin from a TA perspective using Elliot Wave part 2
Updated
Hello. Thanks for the likes on my last analysis. And let me bring you an update.
On the larger timeframe (1D-3D) the market looks bullish and i expect to see an break of the ATH in a few days followed by a leg up to around 88k where we should expect some selling pressure as people and mostly algos. (Algos is short for Algorithm and is used by a lot traders to buy and sell according to fib levels, its simply a bot that buy and sells at specific prices). So the target of 88k is very much till in play.
As we take a look at the market at the 1-4 hour chart one can clearly see a lot of bearish divergence on the indicators, lets round em up!
First of all we got the a downtrend on the TTM Squeeze indicator with dark candles and that signifies low volatility, this means that Mr Market is preparing for an explosive move up or down.
The RSI is also showing lower highs while the market does higher highs, this signifies lower buying pressure as the bulls are running out of fuel.
And finally there was a crossover on the[b] MACD about 3 days ago.
From an Elliot wave perspective the market has made an impulse move up in 5 waves where the 5:th wave was an ending diagonal (example of ending diagonal below) so one can deduct that we are heading down for a ABC completing a wave 2 that will most likely find support at the 0.382-0.5 fib levels (56-55k).
ewminteractive.com/wp-content/uploads/2014/04/ending-diagonal-primer.png
Furthermore the correction and wave count is supported of the price dropping out of the ending diagonal.
So what should one do right now? Im not an financial adviser but my aim is to buy low and sell high. Right now im personally gonna wait for the market to find support around the 56-55k area where im gonna be stacking up on some more altcoins. I just want to clarify that most of my positions is in alts (58 positions as of right now) and i just daytrade bitcoin using Elliot wave and then i add more to my alt positions when bitcoin corrects. There is no point in analyzing altcoins as the alt market is heavily affected by how bitcoin moves so my advice is that bitcoins movement should always be taking into account when buying altcoins. I currently have a short position on bitcoin since 59.3k with a stop loss at 60.5k and target of 56500 and 56000. Thats a Risk/Reward ratio of 3.11 and thats a good trade in my book.
I will be posting further analyzes when the target is reached or i get stomped out.
Take care and if you have any questions or critique you are welcome to leave a comment.
On the larger timeframe (1D-3D) the market looks bullish and i expect to see an break of the ATH in a few days followed by a leg up to around 88k where we should expect some selling pressure as people and mostly algos. (Algos is short for Algorithm and is used by a lot traders to buy and sell according to fib levels, its simply a bot that buy and sells at specific prices). So the target of 88k is very much till in play.
As we take a look at the market at the 1-4 hour chart one can clearly see a lot of bearish divergence on the indicators, lets round em up!
First of all we got the a downtrend on the TTM Squeeze indicator with dark candles and that signifies low volatility, this means that Mr Market is preparing for an explosive move up or down.
The RSI is also showing lower highs while the market does higher highs, this signifies lower buying pressure as the bulls are running out of fuel.
And finally there was a crossover on the[b] MACD about 3 days ago.
From an Elliot wave perspective the market has made an impulse move up in 5 waves where the 5:th wave was an ending diagonal (example of ending diagonal below) so one can deduct that we are heading down for a ABC completing a wave 2 that will most likely find support at the 0.382-0.5 fib levels (56-55k).
ewminteractive.com/wp-content/uploads/2014/04/ending-diagonal-primer.png
Furthermore the correction and wave count is supported of the price dropping out of the ending diagonal.
So what should one do right now? Im not an financial adviser but my aim is to buy low and sell high. Right now im personally gonna wait for the market to find support around the 56-55k area where im gonna be stacking up on some more altcoins. I just want to clarify that most of my positions is in alts (58 positions as of right now) and i just daytrade bitcoin using Elliot wave and then i add more to my alt positions when bitcoin corrects. There is no point in analyzing altcoins as the alt market is heavily affected by how bitcoin moves so my advice is that bitcoins movement should always be taking into account when buying altcoins. I currently have a short position on bitcoin since 59.3k with a stop loss at 60.5k and target of 56500 and 56000. Thats a Risk/Reward ratio of 3.11 and thats a good trade in my book.
I will be posting further analyzes when the target is reached or i get stomped out.
Take care and if you have any questions or critique you are welcome to leave a comment.
Trade active
Might see a slight bump here at the 4h 50 EMA (yellow line)Trade closed: target reached
Trade closed, target reached 56500.Trade active
Update, I think we are in a wave 4 down to low 55k area. But a candle closing above 58800 would invalidate a 5-3-5 (ABC) structure down to low 55k area and instead confirm that 55.5k most likely is the bottom and that we are heading for 68k within the coming days. I do have short open since 58200 with a stop loss at 59k and profit target at 56000.We got the 20 EMA resistance at 58.2k on the 4h and also the 50+100 EMA resistance on the 1hr.
So the trade is pretty low risk as it got a tight stop loss but the odds are pretty much 50/50 of bitcoin breaking up or down.
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