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Analyzing Bitcoin's Wave Count (Short-Term)

This will be a thread of given scenarios of where Bitcoin can go. This has been a very difficult ride to predict, and it has been testing my skills as a technical analyst. But it seems to me that Bitcoin may have another failed breakout. I'm seeing it do a few things that don't match my criteria for impulse waves, and its doing it over and over again. So there is a chance we see sub 8k. According to my indicators, we definitely need a big retrace now. But we've gathered some support by going over the Daily 55 MACD. We will see where this goes, but there is no telling. I'm pretty bearish right now, and my indicators give me the right to have the opinion. Many updates to come on the smaller scale.

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Here is one possible wave count.

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Here is an alternate count that I may actually favor, I believe that this could definitely just be wave 3, and we need a big retrace to cover wave 4. This would also indicate a very extended wave 3.

Wave 2 retrace was only .328, so this one should retrace more. I think this is the scenario we get.

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Here is the 5 minute scale. I do not think it can extend past the height of this max point. The only way that is possible is if this is an extended 3rd. So we must be careful on how we approach this. However, I trust that my indicators reveal that this cannot go much higher.

This last little 5th can do anything. It can stop right here, OR it can extended a little further and complete the channel. But because wave 3 was shorter than 1, then this must be a shorter wave.

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Here is a more clear view of what I think can happen. This can ONLY happen if we stay above the critical support line. If we fall below that line. then it needs to happen in the form of a wedge, OR we will see sub $8k. The volume is the main concern. And this volume pattern that I've noticed before big dips is exactly like what is going on right now. I will show the volume pattern in another update.

So these updates are not only for you all, but kind of for me to store all of my ideas, usually I've made these private, but I felt like I should display these for you all to see what I think. So, it is wise to remember that what I post is an (sometimes likely) option, and not necessarily what is going to happen. I have no idea what is going to happen. I just use my analysis to help guide the way, and alter my thesis based on short-term movements.

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I believe that I've shown this before. But here is the volume pattern and the bear scenario. You could have two cases of head and shoulders. This resistance line could come in BIG!

I couldn't even deny the possibility of this occurring. It either goes really good, or really bad. So we must wait on confirmation. I will definitely play the bounce off of the support line if there is one and take profit at resistance, just to wait and see what happens afterwards. We must consider ALL possible scenarios.

The good thing: On my other Bitcoin post, I noticed the similarities in consolidation time and RSI, MACD and wave count for this correction compared to past ones, and it definitely can show to be over (in terms of correction). Weekly MACD is even bullishly diverging. But does it close on the bullish divergence? Other indicators show that they may pull it down, and create this big domino effect.

The bad thing: In the past, Bitcoin has shown to double bottom off of large corrections, and this could very well be a dead cat bounce. I can't tell you guys how much money i've lost on scalping trades because Bitcoin has done some pretty unpredictable things during this upwards wave. It has always been fairly hard to examine, but It has been as unpredictable as corrective waves are, and has been finding MANY exceptions to impulse waves.

So. Notice how I have no idea which scenario is going to happen? Right. BUT, I'm pretty confident that we need a drop here soon. I will be starstruck if we continue to move higher above $12k. And so will my portfolio D;.

Trade active

Anyways, wave count is more clear now. Short activated.

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Ok. Last update of the day.

This is what I look for on RSI to help confirm my wave count. Usually wave 3 is the strongest on the RSI scale, and wave 5 is weaker. 3 peaks is what I look for on the most relevant timeframe to the wave count. Notice on my earlier update, I looked for the 3 peaks on the 3 hour timescale because it was a wave count on a larger timeframe.

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I LIED.

Uhhh, we are far from the target, but if you got into the short at the top of this thing, i love you. A 5% drop in 25 minutes.

This doesn't look good at all.. But this thing was surely overbought like crazy.

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We will be taking this step by step because corrective waves are very hard to count and predict. This one I think is the most logical. I think we get another little double bottom at the previous low (next hour) before we retrace to to our wave 2 target based on those previous supports and resistances.

The .328 is our target line for wave A. Good luck! Remember, Bulls you all can make money off of these bounces too, that is just very high risk and requires a lot of patience and experience with very quick trades.

I believe we are now in a downtrend. It is twice as hard to make money in a downtrend going long, and twice as hard to make money on an uptrend going short. I learned that the hard way. LOL. When i doubt, stay out.

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Here is my wave count so far. You guys getting the same thing?

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Short and Long setups!

I think we just finished wave 3, and I would expect a short bounce for wave 4 consolidation in the form of a wedge, due to the placement and length of wave 1. I already have a sell order ready at the subwave 4 level as I'm pretty confident we have another drop.

I have also lowered our target to just above $10,000. I hope you bears have been making some money! But bulls, we have an opportunity coming up for a 6% gain soon. But this requires a ton of patience and confirmation. We must wait for confirmation and to see how this formation plays out. It honestly will likely change over time. But I plan on making more on the way down and more on the way up during this AB sequence. Please, make sure you familiarize yourselves with wave count, if you are unfamiliar. I will try to get some time to make a "corrections" educational post that I've been planning, but my time is a little limited. Corrections can be very complex so i want to make sure that I get enough info in that post for you all.

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Let's continue to talk about why sub $8k is proving to be possible here. The volume is a very big concern for me. We notice that its proving my volume theory from the previous post, as we get the bearish divergence during the uptrend, it magically spikes during that sharp sell off during our wave A. Guys, volume goes to the strength of volume. Please review Dow Theory if you are unfamiliar. It makes no sense for volume to be low on a 100% gain in 14 days. I think we need to continue to keep our options open as to not just where we will go, but how we will get there.

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So for this next trade setup (two updates above this), I am only entering on confirmation of the downtrend and resistance to both the channel line and yellow line, OR a descent to below the previous low.

Trade active

May be biting the bullet here, but I like what I'm seeing. Activating trade. Be ready to use stop loss (above $10700)

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Ending 5 Wave Diagonal. Now i'm VERY confident!

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Holy crap! Confidence is gone!! Get ready to use stop loss!!

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My goodness that was scary hahahahaha. But I noticed we've stopped at channel line resistance. I will see what we do here, but I have not incurred the loss yet.

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So its not looking like we will hit our target. But we should continue to descend here shortly. I'm just aiming to break even. Getting too risky. We may be in a 3-3-5 corrective pattern on wave B right now.

Trade closed: target reached

Hahahaha what the heck. I woke up to find we hit my target. I noticed that Bitcoin tends to hit my targets, just not the way that I expect. So here's another unenthusiastic "BOOM!!!". Boom.

I think we have another drop here soon, and I'm ready for long positions!

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YOU GUYS SEE THIS??? We just completed a very bearish head and shoulders! Remember what we say about head and shoulders, after it breaks the neckline, it comes back to it. So I'm gonna enter a long position here soon, for a possible 6% gain. BUT, I think we need to complete this expanding wedge here for another small drop. Then I'm going long.

I'm going to post some alternate wave counts here, because it does seem that our wave 3 is a little short here. But guys, we are going lower. And sub $7k seems likely. Maybe not, this week, but eventually it does. And honestly, that may not be a good thing for those who want cheap alts. So I'm at a bit of a worry here. Volume is definitely proving my case right.

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So here is another option for an extended third. Either way, I am shorting if we find resistance at this neckline. We're just gonna take this thing wave by wave. No idea where it ends up a week from now, But I think we can predict the next day or so. I think we hit this neckline and descend. But it may not be the first time we touch this neckline. If you guys are bulls, just wait and let the market take its toll. Long positions are playing with fire now. These may be the safest short positions you could open now. But always be on guard.

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So within this expanding wedge, we keep getting more and more expanding wedges. This is a disastrous formation on down trends. Completely wild swings with bears in full control. There may be moments when you think bulls have control (like last night), but as long as there is no volume, they can't do anything. I saw many buy walls yesterday of great extent. And it was not because they were bullish. It's because they were driving prices up to fill their short positions. It's called leveraging/cornering the market. It's a technique used by people with a lot of money. Honestly, even though I can short, I'm a bit concerned with Bitcoin and the market in the long run. Based on these formations along with volume.

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Here is exactly what I'm thinking now. I think we are in an extended 3rd, I'm about to short at the 30 min 21 EMA (same as 10 min 55 EMA), AND the .382 retrace line. Wave 2 already retraced a lot, so this should retrace little. I think we squeeze into a descending wedge and I take profit. I'll then try to go long and catch wave 4, because I think it will break the neckline, but it should still stop at the top line resistance for this even larger scale expanding wedge. Expanding wedge Expanding wedge expanding wedge. That's all I see. If you can catch the bottom and top before the trend changes, you will be profitable. We have to stay quick on our feet here. This is going to be nuts.

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Same play is still in formation, nothing unexpected here. I noticed this little inverse head and shoulders that has broken through. I expect some retrace along the neckline and will enter a long towards the .382 fib retrace for our wave 4 target. I am 100% waiting for the neckline retrace, and if I don't get it I'm not entering. Bears have full control, so this trade is HIGH RISK. BUT, with 2 neckline retraces, I feel confident on this trade.

The not so high risk trade that I can't wait to enter is the short position at wave 4. Should be targeting the 9200-9500 area. This is going to be fun.

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BULLS BEWARE!! BITCOIN MIDDLE FINGER SPOTTED!

Trade closed: target reached

Congrats if you guys got into that short!

Trade active

Still has some more to come down in my opinion. But I've been laddering my buys, I'm ready for the long position up to the neckline. Possible 6-7% gain. Good luck guys!

Trade closed: target reached

Get ready for the short!

Trade active

Laddering short positions. Seeing great opportunity here. Hope you all are awake and didn’t leave positions open. I have a feeling a wild ride is going to happen. Up or down! :D

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Seems like as we get further and further through the drop, the higher time frames are taking shots at their respective 55 EMA. Which is an indication of the end of the run, BUT, consolidation before another big drop. I'm targeting between $8800 and 8200 for this next drop. But mainly 8200 at the .618 level. That is where I will surely go long. But that does NOT mean our correction is over.

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forgot to say. If we break these 3 hour supports with conviction, then I'm closing my short and taking the loss!

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Be careful here guys... I think I smell a bear trap.

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Here is an alternate count on the 30 minute chart that leads us back to the top of the resistance line. Not convinced by the volume, as well as the oversold area of the Stoch RSI.

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Guys, We're gonna fall very short of the target in my opinion. We will eventually get there, but I think we get stopped at the 9500 mark for now and then head up to around the mid $10K area.

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Guys i’m drunk right now so only take what i have to say with a grain of salt. It looks like we hit top resistance. Not quite sure if we fall from here or not but it seems the 30MACD is starting to roll over on its slope. Peace.

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Wow. My judgment when I'm intoxicated seems to be very credible.

Anyways, Here's my count. I think we pop soon. Going long around this region. I would like to aim some where towards $10500 again, but time will tell.

Trade closed: target reached

Revised short target is reached. Though, I think we touch 9300 area.

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I went long here. What do you guys think about this alternate count?

Gonna send a few alternate counts you all's way. This is where the count gets confusing and critical at the same time. We must be cautious and cannot be afraid to cut losses and take profit.

P.S. This thread is freaking long.

Trade active

Activating this long position. I will close it when I feel like I need to get out.

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Still short-term bullish on Bitcoin. I'm seeing something like this happening. Maybe the next few days. Will continue to softly monitor. I don't think we break high, the $10.2k resistance will be very hard to break. But its time for a bounce. indicators help confirm what I see in the wave count. But after we reach 10.2k, I expect a large retrace.

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Forgot the photo.

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Since we are struggling so much at this proposed "neckline," I took some profit and will add it back if we break and retrace back to the line.

Trade closed: target reached

BOOOM!!! The 10253 Target was hit with PRECISION.

It gained like crazy this morning, I was purely surprised by the velocity. So I think that we carry out an ABCDE formation to at least $10,500. Hope you guys enjoyed this. If we continue to show bullishness like this, then it may be possible that the correction is over. But I'm not convinced yet, not one bit. This was expected.

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Guys, I'm very certain that we drop again. It's just how and when we drop. I don't think we drop now, because there is still some fight left with the bulls, so watch for a bear trap. Somehow, somehow, Bitcoin always manages to hit my targets, it just does it in a very odd way. So I'm sticking with the 10.5k target for now, and I'm just waiting for it to do something that we can work with. This is a no-trade zone. I want to open a trade based on some more price action, I'm not seeing that yet. But what I can say is that these don't qualify for impulse waves and we should definitely see some more correcting, and I believe that we break the 9k threshold.

Trade active

Guys, I'm laddering my shorts on this bastard now. I dont think it has much room. Maybe it hits my target 2? Maybe not. Maybe it even goes to 10.8k? Idk. All I know is is that we are not going to reach a new high on this run, and I will continue to evaluate as we make progress.

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I still want to keep in mind that this is a valid alternative count. Which would make the 10.5k area a very hard resistance. What made me come back to this is that with a WXY corrective pattern, we infer that it is a bullish 3 wave structure that entails a short correction of around the .382 range, with wave B typically retracing .618 of the drop.

I don't think this wave retraces that far. If it does, then we know the WXY count may be more likely. If it doesn't, then I think we can say that this is more likely, and we will get more of this channel and we break this support and head lower.

This is one of those things where I really don't know what what's going to happen until we get more information. Everyone is playing the guessing game now. But its best to not assume anything more than these short-term trades I'm posting. These tend to be the most likely, profitable and safest plays. These threads are not for the investor, I'm a day trader, and I want to be able to help others that are interested in day trading and how we move. My opinion always changes, because the data always changes (in the short-term).

Within the next one to two weeks, I still think we are going to downtrend. But I'm still bullish long-term.

P.S. Is this thread getting too long? Do I need to make a new one? Hope you guys are profiting! Or at least playing these bounces safely!

Elijah_Trading

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Elijah_Trading

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