RIOT: can go one of two waysRIOT price action has been interesting. The choppy action in the month of October has kept me out of a trade but, the November pump has made things a bit awkward. From EW perspective, I have 2 possible counts that are high probability. I have changed some degree of labeling from my last post, but overall, it's the same idea.
Option 1: Bearish idea that we are still having a larger degree wave 2. Price is putting in wave B right now and we will see a very sharp move down to complete intermediate wave 2 and then go into the bull run of all bull runs for the miner stock.
Option 2: Bullish idea that intermediate wave 2 is complete and price is already in the massive bull run.
So how do we know which one it is? The answer is to let some more time pass.
For option 1 we might see one or two more highs in the next few days before some kind of a bearish divergence gets created in RSI in lower (4/8/12 hour) to higher (daily) time frames. Then, the downturn would be sharp and quick. Everyone will say crypto is dead again and most likely the low of wave A will break.
For option 2, the same one or two highs in the next few days will be just the lower degree wave 3 and the retrace will be slow and choppy for wave 4 for a week or two and it will put in another 5 waves to complete the minor degree wave 1 and then the correction will be a longer wave 2.
The trade will be to watch the price and play the retrace. If things are sharp and quick, we can play the bounces with stop losses. If things are lazy and time consuming, then start to build small positions along fib retrace areas and DCA until some key level breaks. In both cases, trade is not right now and, in both cases, RIOT will make some crazy gains next year. Risk is lower above $20.
