Tag Archives: elliott wave counts bitcoin

BTCUSD: Elliott Wave and Technical Analysis | Charts – December 14, 2018

Last analysis on the 6th of December expected some sideways movement, which is what has happened.

Summary: Use the channel on the main daily chart. Assume more downwards movement while price remains within the channel. When the channel is breached, then assume a multi-month bounce or consolidation may begin that should remain below 7,234.83.

It would be safest to assume that the bear market will continue while Bitcoin remains below 7,234.83. The target is about 1,924, but it may be much lower than this; it is possible this bear market may see the end of Bitcoin.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

Updates to this analysis are in bold.

Last analysis may be found here.

MAIN ELLIOTT WAVE COUNT

MONTHLY

Bitcoin Monthly 2018
Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

I am unable to find reasonable Fibonacci ratios within this wave count. It appears that Bitcoin may not exhibit Fibonacci ratios very often between its waves, so this makes target calculation impossible. Classic technical analysis was used to identify a high in place on the 23rd of December, 2017.

What is very clear from this chart is that Bitcoin is a classic bubble. This looks like an even larger bubble than the Tulip Mania. The only thing about which I am certain is that this bubble will pop and Bitcoin will collapse.

Confidence that Bitcoin was most likely crashing started since the Forever trend line was breached in June.

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

Bitcoin tends to behave like an extreme commodity: price moves upwards for about 2 – 4 weeks in a near vertical movement at the end of its rises. Following this vertical movement the resulting downwards movement is very deep (in percentage terms) and often very quick.

The next rise begins slowly with basing action over weeks or months, and then as the rise nears its end another vertical movement completes it. Also, there are volume spikes just before or at the end, which is another feature typical of commodity like behaviour.

This has happened now several times. The most notable instances are the rise up to the week ending 24th November, 2013, and the week ending 5th June, 2011. The following sharp drops were 94% and 93% respectively.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

Super Cycle wave (II) would most likely be a zigzag, but it may also be a flat, combination or triangle; a zigzag would subdivide 5-3-5.

It is possible that cycle waves a and b may be complete within the expected zigzag of Super Cycle wave (II). Cycle wave a will fit as a leading contracting diagonal, and cycle wave b fits well as a running contracting triangle.

The target calculated expects cycle wave c to exhibit a Fibonacci ratio to cycle wave a. Bitcoin rarely exhibits Fibonacci ratios, so this target does not have a good probability.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

Within cycle wave c, primary wave 1 may be incomplete.

Primary wave 2 may not move beyond the start of primary wave 1 above 7,234.83.

Unfortunately, Bitcoin rarely exhibits Fibonacci ratios in its actionary waves. Therefore, it is impossible to calculate a target. A best fit trend channel is drawn on the chart. An upwards breach of the channel would indicate that primary wave 1 should be over and then primary wave 2 should be underway.

DAILY ALTERNATIVE

Bitcoin daily 2018
Click chart to enlarge.

Primary wave 2 may be subdividing as an expanded flat. Two targets are calculated at two different wave degrees.

Primary wave 1 lasted 41 sessions. Primary wave 2 may last about two to three months to have reasonable proportion to primary wave 1.

Primary wave 2 may not move beyond the start of primary wave 1 above 7,234.83.

SECOND ALTERNATE ELLIOTT WAVE COUNT
DAILY

Bitcoin daily 2018
Click chart to enlarge.

By moving the degree of labelling within cycle wave c up one degree, it is possible that the crash for Bitcoin could be over.

This alternate wave count has changed since the last published analysis. It now sees Super Cycle II over at the last low.

This wave count has a very low probability. It does not follow normal behaviour for Bitcoin.

Normal behaviour for an early second wave correction is for Bitcoin to retrace deeper than 90% of the first wave. This wave count expects that Super Cycle wave (II) was only 84%. While this is very deep, it is not as deep as is normal for Bitcoin.

A candlestick reversal pattern at the low of Super Cycle wave (II) would be fairly likely at the weekly chart level which is not the case at this time.

TECHNICAL ANALYSIS

Bitcoin daily 2018
Click chart to enlarge.

The following can be noted when looking back at Bitcoin’s behaviour during its previous strong falls in price:

The 94% fall in price from June to November 2011 was characterised by:

– Three clearly separate instances of RSI reaching oversold on the daily chart, separated by bounces.

– ADX did not remain very extreme for very long at all on the daily chart.

– On Balance Volume exhibited weak single bullish divergence at the low.

The 93% fall in price from November 2013 to February 2014 was characterised by:

– RSI reached oversold and remained deeply oversold for three weeks; at the low there was only single weak bullish divergence with price.

– ADX remained very extreme for the last seven sessions to the low.

– At the low, On Balance Volume did not exhibit bullish divergence with price; it remained bearish and then exhibited further bearishness after the low as it continued to decline as price began to rise.

For the current fall in price, the current Elliott wave count expects the fall to be larger in terms of duration than the previous two noted here, and at least equivalent in terms of price movement in that a fall of over 90% is expected now.

So far at the lowest low from the all time high Bitcoin has only retraced 0.84. While this is deep, its corrections are usually deeper than this.

For the short term, expect more downwards movement as likely. This is supported by volume. Downwards days have greater support from volume in recent movement.

Published @ 04:56 a.m. EST.

BTCUSD: Elliott Wave and Technical Analysis | Charts – 6th December, 2018

Last analysis on the 21st of November expected more downwards movement for Bitcoin, which is what has happened.

Summary: At this stage, Bitcoin may either bounce up to about 5,827 or move sideways. The bounce or consolidation may last about two to three months.

It would be safest to assume that the bear market will continue while Bitcoin remains below 7,234.83. The target is about 1,924, but it may be much lower than this; it is possible this bear market may see the end of Bitcoin.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

Updates to this analysis are in bold.

Last analysis may be found here.

MAIN ELLIOTT WAVE COUNT

MONTHLY

Bitcoin Monthly 2018
Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

I am unable to find reasonable Fibonacci ratios within this wave count. It appears that Bitcoin may not exhibit Fibonacci ratios very often between its waves, so this makes target calculation impossible. Classic technical analysis was used to identify a high in place on the 23rd of December, 2017.

What is very clear from this chart is that Bitcoin is a classic bubble. This looks like an even larger bubble than the Tulip Mania. The only thing about which I am certain is that this bubble will pop and Bitcoin will collapse.

Confidence that Bitcoin was most likely crashing started since the Forever trend line was breached in June.

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

Bitcoin tends to behave like an extreme commodity: price moves upwards for about 2 – 4 weeks in a near vertical movement at the end of its rises. Following this vertical movement the resulting downwards movement is very deep (in percentage terms) and often very quick.

The next rise begins slowly with basing action over weeks or months, and then as the rise nears its end another vertical movement completes it. Also, there are volume spikes just before or at the end, which is another feature typical of commodity like behaviour.

This has happened now several times. The most notable instances are the rise up to the week ending 24th November, 2013, and the week ending 5th June, 2011. The following sharp drops were 94% and 93% respectively.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

Super Cycle wave (II) would most likely be a zigzag, but it may also be a flat, combination or triangle; a zigzag would subdivide 5-3-5.

It is possible that cycle waves a and b may be complete within the expected zigzag of Super Cycle wave (II). Cycle wave a will fit as a leading contracting diagonal, and cycle wave b fits well as a running contracting triangle.

The target calculated expects cycle wave c to exhibit a Fibonacci ratio to cycle wave a. Bitcoin rarely exhibits Fibonacci ratios, so this target does not have a good probability.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

Within cycle wave c, primary wave 1 may be complete.

Primary wave 2 would most likely subdivide as a zigzag and may end about the 0.618 Fibonacci ratio of primary wave 1.

Primary wave 1 lasted 41 sessions. Primary wave 2 may last about two to three months to have reasonable proportion to primary wave 1.

Primary wave 2 may not move beyond the start of primary wave 1 above 7,234.83.

ALTERNATE ELLIOTT WAVE COUNT

DAILY

Bitcoin daily 2018
Click chart to enlarge.

By moving the degree of labelling within cycle wave c up one degree, it is possible that the crash for Bitcoin could be over.

This wave count has a very low probability. It does not follow normal behaviour for Bitcoin.

Normal behaviour for an early second wave correction is for Bitcoin to retrace deeper than 90% of the first wave. This wave count expects that Super Cycle wave (II) was only 82%. While this is very deep, it is not as deep as is normal for Bitcoin.

A candlestick reversal pattern at the low of Super Cycle wave (II) would be fairly likely at the weekly chart level and not only the daily chart, which is not the case at this time.

TECHNICAL ANALYSIS

Bitcoin daily 2018
Click chart to enlarge.

The following can be noted when looking back at Bitcoin’s behaviour during its previous strong falls in price:

The 94% fall in price from June to November 2011 was characterised by:

– Three clearly separate instances of RSI reaching oversold on the daily chart, separated by bounces.

– ADX did not remain very extreme for very long at all on the daily chart.

– On Balance Volume exhibited weak single bullish divergence at the low.

The 93% fall in price from November 2013 to February 2014 was characterised by:

– RSI reached oversold and remained deeply oversold for three weeks; at the low there was only single weak bullish divergence with price.

– ADX remained very extreme for the last seven sessions to the low.

– At the low, On Balance Volume did not exhibit bullish divergence with price; it remained bearish and then exhibited further bearishness after the low as it continued to decline as price began to rise.

For the current fall in price, the current Elliott wave count expects the fall to be larger in terms of duration than the previous two noted here, and at least equivalent in terms of price movement in that a fall of over 90% is expected now.

So far at the lowest low from the all time high Bitcoin has only retraced 0.82. While this is deep, its corrections are usually deeper than this.

A bounce or consolidation may unfold for the short to mid term. This view is supported by:

1. On the 26th, 27th and 28th of November a Morning Doji Star unfolded.

2. RSI reached deeply oversold and there exhibited bullish divergence with price.

3. The short-term volume profile is bullish.

4. ADX reached very extreme and is now declining.

Support is identified on the chart.

Published @ 02:02 a.m. EST.

BTCUSD: Elliott Wave and Technical Analysis | Charts – 21st November, 2018

The first preferred Elliott wave count expected Bitcoin to exhibit an increase in downwards momentum. This is exactly what is happening. The second Elliott wave count was invalidated seven days ago.

Summary: Downwards movement has push from rising volume. This is very bearish. Expect downwards movement to continue until there is a bullish candlestick reversal signal on the daily chart. Next support below is at 3,612 and 2,980.

I cannot at this time yet see a completed corrective Elliott wave structure for this downwards movement, so I expect it is incomplete.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

Updates to this analysis are in bold.

Last analysis may be found here.

FIRST ELLIOTT WAVE COUNT

MONTHLY

Bitcoin Monthly 2018
Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

I am unable to find reasonable Fibonacci ratios within this wave count. It appears that Bitcoin may not exhibit Fibonacci ratios very often between its waves, so this makes target calculation impossible. Classic technical analysis was used to identify a high in place on the 23rd of December, 2017.

What is very clear from this chart is that Bitcoin is a classic bubble. This looks like an even larger bubble than the Tulip Mania. The only thing about which I am certain is that this bubble will pop and Bitcoin will collapse.

Now that the Forever trend line is breached some confidence may be had that Bitcoin may be crashing.

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

Bitcoin tends to behave like an extreme commodity: price moves upwards for about 2 – 4 weeks in a near vertical movement at the end of its rises. Following this vertical movement the resulting downwards movement is very deep (in percentage terms) and often very quick.

The next rise begins slowly with basing action over weeks or months, and then as the rise nears its end another vertical movement completes it. Also, there are volume spikes just before or at the end, which is another feature typical of commodity like behaviour.

This has happened now several times. The most notable instances are the rise up to the week ending 24th November, 2013, and the week ending 5th June, 2011. The following sharp drops were 94% and 93% respectively.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

Super Cycle wave (II) would most likely be a zigzag, but it may also be a flat, combination or triangle; a zigzag would subdivide 5-3-5. Cycle wave a should subdivide as a five wave structure, but so far that would be incomplete.

Within this five wave structure unfolding lower, minor wave 3 may now have moved through its middle. Minor wave 4 may not move back up into minor wave 1 price territory above 6,463.54.

When cycle wave a may be seen as complete, then a one to multi-year bounce or consolidation for cycle wave b may be expected. This may present a weak buying opportunity, but the huge variation in structure of b waves makes this extremely risky.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

If Bitcoin is crashing, then a five down structure should develop at the weekly chart level. This would still be incomplete.

A third wave down may now be moving through its middle at six degrees. Bitcoin may be still winding up for a further spectacular plummet in price. The strongest fall may come towards the end of any one or more of these third waves as Bitcoin exhibits commodity like behaviour. Commodities tend to have their strongest portion of impulses in the fifth waves.

Within the middle of this third wave, subminuette wave iii may be either complete or close to complete. Subminuette wave iv may not move into subminuette wave i price territory above 6,134.76.

Only when a clear bullish reversal pattern forms on the daily chart would a more time consuming bounce or consolidation be expected to interrupt this downwards trend. Today that is not present, so it seems more reasonable to expect this downwards movement to continue.

TECHNICAL ANALYSIS

Bitcoin daily 2018
Click chart to enlarge.

For the short term, support from volume is pushing price lower. This is very bearish.

The following can be noted when looking back at Bitcoin’s behaviour during its previous strong falls in price:

The 94% fall in price from June to November 2011 was characterised by:

– Three clearly separate instances of RSI reaching oversold on the daily chart, separated by bounces.

– ADX did not remain very extreme for very long at all on the daily chart.

– On Balance Volume exhibited weak single bullish divergence at the low.

The 93% fall in price from November 2013 to February 2014 was characterised by:

– RSI reached oversold and remained deeply oversold for three weeks; at the low there was only single weak bullish divergence with price.

– ADX remained very extreme for the last seven sessions to the low.

– At the low, On Balance Volume did not exhibit bullish divergence with price; it remained bearish and then exhibited further bearishness after the low as it continued to decline as price began to rise.

For the current fall in price, the current Elliott wave count expects the fall to be larger in terms of duration than the previous two noted here, and at least equivalent in terms of price movement in that a fall of over 90% is expected now. Currently, ADX is not yet extreme. RSI is now deeply oversold, but past behaviour indicates this may continue for some time. There is plenty of room for this downwards trend in Bitcoin to continue.

So far at the lowest low from the all time high Bitcoin has only retraced 0.79. While this is deep, its corrections are usually deeper than this.

Support below is identified on the chart.

Published @ 05:23 a.m. EST.

BTCUSD: Elliott Wave and Technical Analysis | Charts – 17th October, 2018

Bitcoin continues to move sideways and remains range bound.

Summary: A clear breach of a support line, which has seen all price action above it until this point, is a strong indication that Bitcoin is bearish. Now that a backtest about the support line is complete, price may be expected to continue to move downwards from this line.

At this time, Bitcoin may be in the early stages of a third wave down at six degrees.

A new alternate Elliott wave count is published today which allows for a large bounce here before a continuation of downwards movement to new lows.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

Updates to this analysis are in bold.

Last analysis may be found here.

FIRST ELLIOTT WAVE COUNT

MONTHLY

Bitcoin Monthly 2018
Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

I am unable to find reasonable Fibonacci ratios within this wave count. It appears that Bitcoin may not exhibit Fibonacci ratios very often between its waves, so this makes target calculation impossible. Classic technical analysis was used to identify a high in place on the 23rd of December, 2017.

What is very clear from this chart is that Bitcoin is a classic bubble. This looks like an even larger bubble than the Tulip Mania. The only thing about which I am certain is that this bubble will pop and Bitcoin will collapse.

Now that the Forever trend line is breached some confidence may be had that Bitcoin may be crashing.

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

Bitcoin tends to behave like an extreme commodity: price moves upwards for about 2 – 4 weeks in a near vertical movement at the end of its rises. Following this vertical movement the resulting downwards movement is very deep (in percentage terms) and often very quick.

The next rise begins slowly with basing action over weeks or months, and then as the rise nears its end another vertical movement completes it. Also, there are volume spikes just before or at the end, which is another feature typical of commodity like behaviour.

This has happened now several times. The most notable instances are the rise up to the week ending 24th November, 2013, and the week ending 5th June, 2011. The following sharp drops were 94% and 93% respectively.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

If Bitcoin is in the early stages of a huge crash, then a five down structure should develop at the weekly chart level. This would still be incomplete.

A third wave down may now be beginning at six degrees. Bitcoin may be still winding up for a spectacular plummet in price. The strongest fall may come towards the end of any one or more of these third waves as Bitcoin exhibits commodity like behaviour. Commodities tend to have their strongest portion of impulses in the fifth waves.

The best fit channel has only weak technical significance and is now breached.

The Forever trend line is not perfectly showing where price found support and has then found resistance for a typical back test. However, it is about where price found support and resistance. The breach and back test are highly significant.

I have searched to find if a five down could be seen as complete. At this time, I cannot yet see either a complete impulse or a leading diagonal.

SECOND ELLIOTT WAVE COUNT

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

It is also possible that Bitcoin may move lower as a flat correction, double combination or a double zigzag.

Within a flat correction, cycle wave a may have completed as a zigzag. Cycle wave b would need to move higher to retrace a minimum 0.9 length of cycle wave a at 18,480. Cycle wave b would need to subdivide as a corrective structure, most likely a zigzag. Cycle wave b within a flat correction may make a new price extreme beyond the start of cycle wave a.

Within a double zigzag, cycle wave w may be the first zigzag complete. Cycle wave x would have no minimum nor maximum required length to cycle wave w; it only needs to complete as a corrective structure, which would most likely be a zigzag. X waves within double zigzags are usually shallow, so that the whole structure has a strong slope.

Within a double combination, cycle wave w may be the first complete structure as a zigzag. Cycle wave x would have no minimum nor maximum required length to cycle wave w; it only needs to complete as a corrective structure, which would most likely be a zigzag. X waves within combinations are usually deep, so that the whole structure has a sideways look. Cycle wave x within a combination may make a new price extreme beyond the start of cycle wave w.

A second wave may not subdivide as a triangle with its sole corrective structure, so a triangle for this correction is not considered.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

The daily chart focusses on the whole of cycle wave b or x so far.

Cycle wave b or x may be unfolding as a regular flat correction, and within it primary wave A fits as a three and primary wave B also fits as a corrective structure. Primary wave B effects a net 0.965 re-tracement of primary wave A at its end. This meets the minimum requirement of 0.9 for B waves within flat corrections.

A target is calculated for primary wave C to end. However, because Bitcoin does not exhibit reliable Fibonacci ratios this target is a rough guideline only. A better guide may be resistance about the orange forever trend line.

TECHNICAL ANALYSIS

Bitcoin daily 2018
Click chart to enlarge.

Volume is declining (at higher time frames); this market is falling mostly of its own weight. However, looking more closely, daily volume is stronger for downwards days than for upwards days.

The following can be noted when looking back at Bitcoin’s behaviour during its previous strong falls in price:

The 94% fall in price from June to November 2011 was characterised by:

– Three clearly separate instances of RSI reaching oversold on the daily chart, separated by bounces.

– ADX did not remain very extreme for very long at all on the daily chart.

– On Balance Volume exhibited weak single bullish divergence at the low.

The 93% fall in price from November 2013 to February 2014 was characterised by:

– RSI reached oversold and remained deeply oversold for three weeks; at the low there was only single weak bullish divergence with price.

– ADX remained very extreme for the last seven sessions to the low.

– At the low, On Balance Volume did not exhibit bullish divergence with price; it remained bearish and then exhibited further bearishness after the low as it continued to decline as price began to rise.

For the current fall in price, the current Elliott wave count expects the fall to be larger in terms of duration than the previous two noted here, and at least equivalent in terms of price movement in that a fall of over 90% is expected now. Currently, ADX is not yet extreme and RSI is not yet oversold. There is plenty of room for this downwards trend in Bitcoin to continue. So far at the lowest low from the all time high Bitcoin has only retraced 0.70. While this is deep, its corrections are usually deeper than this.

On Balance Volume and price remain range bound. Price has resistance about 7,775 and support about 5,890. Watch both closely to see a breakout.

Published @ 03:21 p.m. EST.

BTCUSD: Elliott Wave and Technical Analysis | Charts – 19th September, 2018

Bitcoin continues to move mostly sideways, with a slight downwards bias.

Summary: A clear breach of a support line, which has seen all price action above it until this point, is a strong indication that Bitcoin is bearish. Now that a backtest about the support line is complete, price may be expected to continue to move downwards from this line.

At this time, Bitcoin may be in the early stages of a third wave down at four degrees.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

Updates to this analysis are in bold.

Last analysis may be found here.

FIRST ELLIOTT WAVE COUNT

MONTHLY

Bitcoin Monthly 2018
Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

I am unable to find reasonable Fibonacci ratios within this wave count. It appears that Bitcoin may not exhibit Fibonacci ratios very often between its waves, so this makes target calculation impossible. Classic technical analysis was used to identify a high in place on the 23rd of December, 2017.

What is very clear from this chart is that Bitcoin is a classic bubble. This looks like an even larger bubble than the Tulip Mania. The only thing about which I am certain is that this bubble will pop and Bitcoin will collapse.

Now that the Forever trend line is breached some confidence may be had that Bitcoin may be crashing.

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

Bitcoin tends to behave like an extreme commodity: price moves upwards for about 2 – 4 weeks in a near vertical movement at the end of its rises. Following this vertical movement the resulting downwards movement is very deep (in percentage terms) and often very quick.

The next rise begins slowly with basing action over weeks or months, and then as the rise nears its end another vertical movement completes it. Also, there are volume spikes just before or at the end, which is another feature typical of commodity like behaviour.

This has happened now several times. The most notable instances are the rise up to the week ending 24th November, 2013, and the week ending 5th June, 2011. The following sharp drops were 94% and 93% respectively.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

If Bitcoin is in the early stages of a huge crash, then a five down structure should develop at the weekly chart level. This would still be incomplete.

A third wave down may now be beginning at five degrees. Bitcoin may be still winding up for a spectacular plummet in price. The strongest fall may come towards the end of any one or more of these third waves as Bitcoin exhibits commodity like behaviour. Commodities tend to have their strongest portion of impulses in the fifth waves.

The best fit channel has only weak technical significance.

The Forever trend line is not perfectly showing where price found support and has then found resistance for a typical back test. However, it is about where price found support and resistance. The breach and back test are highly significant.

My alternate bullish wave count was discarded because the Forever trend line is properly breached and now has a successful backtest.

I have again searched to find if a five down could be seen as complete. At this time, I cannot yet see either a complete impulse or a leading diagonal.

TECHNICAL ANALYSIS

Bitcoin daily 2018
Click chart to enlarge.

Volume is declining (at higher time frames); this market is falling mostly of its own weight. However, looking more closely, daily volume is stronger for downwards days than for upwards days.

The following can be noted when looking back at Bitcoin’s behaviour during its previous strong falls in price:

The 94% fall in price from June to November 2011 was characterised by:

– Three clearly separate instances of RSI reaching oversold on the daily chart, separated by bounces.

– ADX did not remain very extreme for very long at all on the daily chart.

– On Balance Volume exhibited weak single bullish divergence at the low.

The 93% fall in price from November 2013 to February 2014 was characterised by:

– RSI reached oversold and remained deeply oversold for three weeks; at the low there was only single weak bullish divergence with price.

– ADX remained very extreme for the last seven sessions to the low.

– At the low, On Balance Volume did not exhibit bullish divergence with price; it remained bearish and then exhibited further bearishness after the low as it continued to decline as price began to rise.

For the current fall in price, the current Elliott wave count expects the fall to be larger in terms of duration than the previous two noted here, and at least equivalent in terms of price movement in that a fall of over 90% is expected now. Currently, ADX is not yet extreme and RSI is not yet oversold. There is plenty of room for this downwards trend in Bitcoin to continue.

Watch On Balance Volume carefully over the next couple of weeks or so. If it breaks out of the current range before price does, then it may signal the breakout direction for price. Both price and On Balance Volume are currently range bound.

Published @ 05:25 a.m. EST.

BTCUSD Elliott Wave and Technical Analysis – 13th August, 2018

Bitcoin has moved sideways since last analysis.

Summary: A clear breach of a support line, which has seen all price action above it until this point, is a strong indication that Bitcoin is bearish. Now that a backtest about the support line is complete, price may be expected to continue to move downwards from this line.

At this time, Bitcoin may be in the early stages of a third wave down at four degrees.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

Updates to this analysis are in bold.

Last analysis may be found here.

FIRST ELLIOTT WAVE COUNT

MONTHLY

Bitcoin Monthly 2018
Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

I am unable to find reasonable Fibonacci ratios within this wave count. It appears that Bitcoin may not exhibit Fibonacci ratios very often between its waves, so this makes target calculation impossible. Classic technical analysis was used to identify a high in place on the 23rd of December, 2017.

What is very clear from this chart is that Bitcoin is a classic bubble. This looks like an even larger bubble than the Tulip Mania. The only thing about which I am certain is that this bubble will pop and Bitcoin will collapse.

Now that the Forever trend line is breached some confidence may be had that Bitcoin may be crashing.

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

Bitcoin tends to behave like an extreme commodity: price moves upwards for about 2 – 4 weeks in a near vertical movement at the end of its rises. Following this vertical movement the resulting downwards movement is very deep (in percentage terms) and often very quick.

The next rise begins slowly with basing action over weeks or months, and then as the rise nears its end another vertical movement completes it. Also, there are volume spikes just before or at the end, which is another feature typical of commodity like behaviour.

This has happened now several times. The most notable instances are the rise up to the week ending 24th November, 2013, and the week ending 5th June, 2011. The following sharp drops were 94% and 93% respectively.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

If Bitcoin is in the early stages of a huge crash, then a five down structure should develop at the weekly chart level. This would still be incomplete.

A third wave down may now be beginning at four degrees. Bitcoin may be still winding up for a spectacular plummet in price. The strongest fall may come towards the end of any one or more of these third waves as Bitcoin exhibits commodity like behaviour. Commodities tend to have their strongest portion of impulses in the fifth waves.

The best fit channel was not perfectly showing where bounces found resistance, so it has been adjusted. This channel has only weak technical significance.

The Forever trend line is not perfectly showing where price found support and has then found resistance for a typical back test. However, it is about where price found support and resistance. The breach and back test are highly significant.

My alternate bullish wave count is now discarded because the Forever trend line is properly breached and now has a successful backtest.

TECHNICAL ANALYSIS

Bitcoin daily 2018
Click chart to enlarge.

Volume is declining (at higher time frames); this market is falling mostly of its own weight. However, looking more closely, daily volume is stronger for downwards days than for upwards days.

The following can be noted when looking back at Bitcoin’s behaviour during its previous strong falls in price:

The 94% fall in price from June to November 2011 was characterised by:

– Three clearly separate instances of RSI reaching oversold on the daily chart, separated by bounces.

– ADX did not remain very extreme for very long at all on the daily chart.

– On Balance Volume exhibited weak single bullish divergence at the low.

The 93% fall in price from November 2013 to February 2014 was characterised by:

– RSI reached oversold and remained deeply oversold for three weeks; at the low there was only single weak bullish divergence with price.

– ADX remained very extreme for the last seven sessions to the low.

– At the low, On Balance Volume did not exhibit bullish divergence with price; it remained bearish and then exhibited further bearishness after the low as it continued to decline as price began to rise.

For the current fall in price, the current Elliott wave count expects the fall to be larger in terms of duration than the previous two noted here, and at least equivalent in terms of price movement in that a fall of over 90% is expected now. Currently, ADX is not yet extreme and RSI is not yet oversold. There is plenty of room for this downwards trend in Bitcoin to continue.

Published @ 11:11 p.m. EST.

BTCUSD Elliott Wave and Technical Analysis – 13th July, 2018

Last analysis presented a scenario that Bitcoin was most likely in the early stages of a collapse while price stayed below 13,031.04. This still remains the case today.

Summary: A clear breach of a support line, which has seen all price action above it until this point, is a strong indication that Bitcoin is bearish. At this time, Bitcoin may be beginning a third wave down at five degrees; if it is, then it should start to exhibit a strong increase in downwards momentum.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

Updates to this analysis are in bold.

Last analysis may be found here.

FIRST ELLIOTT WAVE COUNT

MONTHLY

Bitcoin Monthly 2018
Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

I am unable to find reasonable Fibonacci ratios within this wave count. It appears that Bitcoin may not exhibit Fibonacci ratios very often between its waves, so this makes target calculation impossible. Classic technical analysis will then be used to identify a high in place.

What is very clear from this chart is that Bitcoin is in a classic bubble. This looks like an even larger bubble than the Tulip Mania. The only thing about which I am certain is that this bubble will pop and Bitcoin will collapse.

What is uncertain is exactly when it will crash. For that question to be answered Elliott wave analysis may be helpful. Now that the Forever trend line is breached some confidence may be had that Bitcoin may be crashing.

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

Bitcoin tends to behave like an extreme commodity: price moves upwards for about 2 – 4 weeks in a near vertical movement at the end of its rises. Following this vertical movement the resulting downwards movement is very deep (in percentage terms) and often very quick.

The next rise begins slowly with basing action over weeks or months, and then as the rise nears its end another vertical movement completes it. Also, there are volume spikes just before or at the end, which is another feature typical of commodity like behaviour.

This has happened now several times. The most notable instances are the rise up to the week ending 24th November, 2013, and the week ending 5th June, 2011. The following sharp drops were 94% and 93% respectively.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

If Bitcoin is in the early stages of a huge crash, then a five down structure should develop at the daily chart level. This would still be incomplete.

A third wave down may now be beginning at five degrees. Bitcoin may be still winding up for a spectacular plummet in price. The strongest fall may come towards the end of any one or more of these third waves as Bitcoin exhibits commodity like behaviour. Commodities tend to have their strongest portion of impulses in the fifth waves.

While price remains below the upper edge of the best fit channel, expect bounces to find resistance there. On the other side of the channel, the lower edge should be breached by the strength of one of the ends of any one of the third waves which are unfolding.

SECOND ELLIOTT WAVE COUNT

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

It is also still just possible that the rise for Bitcoin is not over. The last blow off top may have only been the end of a third wave, so a still stronger fifth wave may be yet to come.

Primary wave 4 may not move into primary wave 1 price territory below 492.80, but this price point is far away for any usefulness. The Forever trend line is now very clearly breached by three full weekly candlesticks below and not touching it. This may be a relatively early indication that this bullish wave count may be wrong. The probability of it is reduced, so it should be discarded.

TECHNICAL ANALYSIS

Bitcoin daily 2018
Click chart to enlarge.

Volume is declining (at higher time frames); this market is falling mostly of its own weight. However, looking more closely, daily volume is stronger for downwards days than for upwards days.

Using ADX as a trend indicator, at this time it indicates a very extreme downwards trend, which can continue further. Bitcoin can sustain very extreme trends for very long periods of time.

Published @ 04:37 a.m. EST.

BTCUSD Elliott Wave and Technical Analysis – 15th February, 2018

Two scenarios for Bitcoin and a clear price point which differentiates the two ideas are presented in this analysis.

Summary: While price remains below 13,031.04 and below the Magee bear market trend line, the possibility that Bitcoin is in the early stages of collapse will remain. A new high above 13,031.04 by any amount at any time frame would be a bullish signal for Bitcoin. If that happens, then look out for another exponential rise to substantial new highs, which may only end after a minimum of 2 weeks vertical upwards movement on high volume.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

FIRST ELLIOTT WAVE COUNT

2 WEEKLY

Bitcoin 2 weekly 2018
Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

I am unable to find reasonable Fibonacci ratios within this wave count. It appears that Bitcoin may not exhibit Fibonacci ratios very often between its waves, so this makes target calculation impossible. Classic technical analysis will then be used to identify a high in place.

What is very clear from this chart is that Bitcoin is in a classic bubble. This looks like an even larger bubble than the Tulip Mania. The only thing about which I am certain is that this bubble will pop and Bitcoin will collapse.

What is uncertain is exactly when it will crash. For that question to be answered Elliott wave analysis may be helpful, and if the Forever trend line is breached, then reasonable confidence may be had that Bitcoin is crashing.

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

Bitcoin tends to behave like an extreme commodity: price moves upwards for about 2 – 4 weeks in a near vertical movement at the end of its rises. Following this vertical movement the resulting downwards movement is very deep (in percentage terms) and often very quick.

The next rise begins slowly with basing action over weeks or months, and then as the rise nears its end another vertical movement completes it. Also, there are volume spikes just before or at the end, which is another feature typical of commodity like behaviour.

This has happened now several times. The most notable instances are the rise up to the week ending 24th November, 2013, and the week ending 5th June, 2011. The following sharp drops were 94% and 93% respectively.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

If Bitcoin is in the early stages of a huge crash, then a five down structure should develop at the daily chart level. This would be incomplete.

A third wave cannot yet be seen as complete for intermediate wave (3). This wave count sees a series now of three overlapping first and second waves. If this wave count is correct, then Bitcoin may be winding up for a spectacular plummet in price in the next couple of weeks or so.

Minute wave ii may not move beyond the start of minute wave i above 13,031.04.

SECOND ELLIOTT WAVE COUNT

WEEKLY

Bitcoin weekly 2018
Click chart to enlarge.

It is also possible that the rise for Bitcoin is not over. The last blow off top may have only been the end of a third wave, so a still stronger fifth wave may be yet to come.

Primary wave 4 may not move into primary wave 1 price territory below 492.80, but this price point is far away for any usefulness though. The Forever trend line on the 2 weekly chart would see this wave count discarded long before price invalidated it.

DAILY

Bitcoin daily 2018
Click chart to enlarge.

If the last fall in price for Bitcoin is just another relatively short lived pullback, then it must subdivide as an Elliott wave corrective structure. This movement will fit nicely as a double zigzag, which may now be complete.

Because triple zigzags are very rare structures (I have only ever seen 2 or 3 in my now 10 years of daily Elliott wave analysis), it is extremely likely that the correction is complete when a double zigzag is complete.

Within primary wave 5, no second wave correction may make a new low below the start of its first wave below 5,968.36.

A new high above 13,031.04 would see confidence in this wave count. If that happens, then my expectation would be for Bitcoin to see another exponential rise, only ending after a minimum of 2 weeks vertical movement on very high volume.

TECHNICAL ANALYSIS

Bitcoin daily 2018
Click chart to enlarge.

If price breaks above the Magee bear market trend line, then assume Bitcoin would very likely make new highs.

Not all bullish long lower wicks appear at swing lows, but they are a persistent feature at lows.

When a bullish long lower wick is accompanied by a volume spike, then the probability that a swing low is in is very high.

Currently, volume supports downwards movement much more so than upwards. The volume profile is bearish. This supports the first Elliott wave count.

Published @ 05:33 p.m. EST.

BTCUSD Elliott Wave and Technical Analysis – 23rd December, 2017

Has the Bitcoin bubble burst? I look at price and volume, along with trend lines, to answer this question.

Last analysis stated: “Instead of trying to figure out where this bubble may go, I’ll focus on figuring out when it may have popped. A strong bearish candlestick pattern at the weekly chart level and a trend channel or trend line breach will be looked for.”

There is a completed weekly candlestick at the end of today’s session, and it is a strong bearish engulfing candlestick pattern.

But the channel is not yet breached.

Volume supports the idea of a high in place, but the bottom line is that there is substantial risk to any short position while price remains within the channel.

Look now for a bounce to not make a new all time high, which should exhibit weakness in volume. Then look for the channel breach.

Manage risk diligently.

ELLIOTT WAVE CHARTS

2 WEEKLY

Bitcoin 2 weekly 2017
Click chart to enlarge.

WEEKLY

Bitcoin weekly 2017
Click chart to enlarge.

DAILY

Bitcoin daily 2017
Click chart to enlarge.

VOLUME ANALYSIS

Bitcoin volume 2017
Click chart to enlarge. Chart courtesy of Bitcoinity.org.

A huge drop in volume suggests exhaustion.

Published @ 02:22 a.m. EST.