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Correctivestructure

S&P500: the market took the alternate route.Last week I presented two options " The first is that the S&P500 has completed classic symmetrical triangle. It is a continuation pattern, meaning that the move going into the triangle will continue. In this case it was the move from 3029 DOWN to 2822 that was the initiation move. Assuming SPX2939 was the top of the b-wave, then simple symmetry targets: 2939 - (3029-2822) = 2732. Applying triangle "rules", then depending on where exactly price will move below the lower trendline of the triangle -say at 2829- then we're looking for 2622. So we have a SPX2732-2622 target zone, which we can refine once more price data becomes available. The other options the market still has at this moment is to complete a diagonal pattern (labeled as "alt: 3", alt: 4"). A simple 5=1 then targets SPX2957. This would best count as what is called an ending diagonal in Elliott wave terms as the sub-waves count best as 3s and not 5s. A break and close below SPX2890 will take IMHO this option off the table. Note how price so far pretty much bottomed right there today... keeping us guessing a bit longer... ;-) " While the 1st option looked best, also because the QQQ's had a nice triangle pattern forming (see here ) up to last Wednesday, on Thursday the markets threw the proverbial curve-ball as it often does and thus kept us guessing longer and yet again. The price pattern in the current rally still looks and counts best as that of a diagonal, albeit it has already (far) exceeded the ideal price target of SPX2957 I was looking for in that case. BUT, with today's price action we're right back at it as price reached the 78.60% retrace of the prior decline in early August ;-) So what does all this mean? 1) the recent price action continues to morph into other options as the market provides us with its twists and turns. This constant morphing and adjustment of Elliott wave counts keeps me cautiously bullish as price is moving higher, but normally Bull runs are more straight forward and require less re-adjustments as impulse move much more predicable than corrective structures. 2) There's a considerable amount of upside gaps left below current prices, which may need to get filled first. 3) price is currently sitting right at support, which must be respected until broken. 4) not shown here, but the 50d SMA is currently sitting at SPX2948 and price will have to close below it to change trends from up to down. So as the markets continue to pull all sorts of confusing stunts I am therefore still viewing this as part of a very complex b-wave. Currently, I have no clear immediate downside set up in place, and with price above its rising 20d, 50d and 200d SMA I am therefore cautiously Bullish. IF you wonder if the rally to SPX2800-4200 has started, I must admit I have no high probability count for that yet. Until then, being cautious is probably the best approach for now. Watch the 50d SMA for further clues.
SP:SPX
by intelligent_investing
4
Where is BTC (Bitcoin) Headed?I would like to share with you a comprehensive analysis of where we are at with bitcoin. An explanation of why there is so much confusion, why nothing seems positive and where we could possibly be headed. This is something I have shared with Purple Crypto Premium members. I have here for you 4 charts drilling down from 1D to the 4H chart. It is clear we are in a corrective wave formation and have been for a while now. The 200 EMA has been nearing the 314 EMA on the 6H chart. It has crossed over on the 4H chart, and it looks like it is starting to turn down on the 12H chart. Point to note though is that on the 4H chart, it does look like it is starting to cross back over. What the? Why the confusion? Because we are at the deciding point about the future of BTC. We are smack bang in the middle of a flat wave formation (which you can see clearly on the 6H chart) after hitting a double top (visible on the 1D) chart. So are we going up or down? Lol... Here is my 'BTC ends its bull run' analysis from August 10: I have read several analyses of BTC's "Parabolic Growth" theory (which btw, I think is absolutely rubbish). Here's my take on it: Do I want BTC to downtrend - NO. Who does? Oh yes...the whales. Do we have to prepared for it. YES. What do we do if BTC downtrends? Use what I refer to as "double trade profit points" to benefit from it (I absolutely love these). There is a hidden message in this chart...read carefully: And here is a scenario for where BTC could be headed should it turn into a significant downtrend: I would love for it to turn up as I am sure many of us would. However, right at this moment, anyone be crazy to make a prediction. There is simply no way to know and it is simply a matter of wait and see what happens. I would love for you to share your ideas. Please comment below and hit like if you'd like to support my work. ______ Follow me on Purple Crypto Telegram: t.me
BITSTAMP:BTCUSD
by PurpleCrypto
S&P500 complex enough for you?!My last update I ended with " Lastly, note that I label the larger waves as i/a, 2/b etc, because we can never know before hand if a move -even if 5 waves- in either direction is the start of a new impulse (i,ii, etc) or part of a correction (a,b,c) where wave a and c are also 5 waves... So to prevent hubris, always label them as both initially until the market eventually tells you which it is. Yes even c-waves can be made up of three waves, and are not always and necessarily comprised of five waves! " Well, we indeed only got three waves down, thus that was corrective: anticipate, monitor, adjust if necessary. With today's rally, which is still also and only three waves up off last Friday;s low, and those three waves down last week, the best pattern that fits the current price action right now is a triangle (a,b,c,d,e) with wave-e now underway. Triangles are one of the hardest patterns to forecast and foresee (nobody knew with all certainty early August this pattern would transpire, and how could one?!). Today's high could already be enough for wave-e (the final wave), but we can set a target zone of SPX 2920-2935 right into the upper trendline depending a bit on how strict one draws it. Above that -and especially above SPX2945- and something else is going on. Note that the previous two monster gap ups at open were filled and I expect the same to happen in the not too distant future. Trade safe!
SP:SPX
by intelligent_investing
10
S&P500 getting more complex by the dayThe S&P500 (and all other major US indices) experienced some (nice?!) whipsaws last week: Neither the bulls nor bears won. Whatever the future may exactly hold, the recent price action is very confusing and still, believe it or not, range bound. I've seen more ways to Elliott wave count the price action over the last two weeks, which in the end IMHO means it is (part of) a corrective structure because everybody can count an impulse down, than one can throw sticks at and at some point one will stick (pun intended). Question is if the correction is already over (red alt: ii) or still on going (green b) Looking at all the available information, my read is that we will continue to have a bullish bias over the next few days, due to the triple 90% up day last Friday for both A/D % and Up/Down Volume %. . This is most likely a strong enough reading to keep markets afloat into the 2950-3000 resistance area, thereby continuing to follow the average pre-election year pattern the market has followed all year long so far. IF price can get above resistance, with a first warning above SPX2965 then the Bulls can push price into the 3100-3200 levels and higher, but this is not my preferred outcome right now. So, while with help of futures' driven monster gap ups the markets are staying afloat, there is no clear resolution yet as to which path the markets are ultimately on. Please remember that IF the Bull train to SPX3900+ has started there's still >800p of upside potential left when this option is confirmed. Current upside potential is maybe therefore 1000p and for those who don't day-trade every blip, it would not be unwise to wait for more certainty. But that's just me. For now the small floor is at SPX2913. Below it opens up SPX2900+/-10p. Trade safe!
SP:SPX
by intelligent_investing
3
EW ANALYSIS: Bitcoin In A Big Bullish Triangle?!Hello traders, today we will talk about Bitcoin! Bitcoin is trading sideways since the end of June, which more and more looks like a corrective bullish triangle pattern in wave 4. One of the main reasons for this view is GBTC - Grayscale Bitcoin Investment Trust in which we also see a bullish triangle formation, so don't be surprised if BTC bounces again soon! Even ALT coins are trading at strong support levels, while BTC is trading bearish, because BTC is losing its dominance! So, when BTC finds support, this is when ALTs may fly high! However, to confirm our view, we need a strong rise back above 11000 level, but bulls can be confirmed only above 12000 region that can later open door for 15000-16000 area within the final wave 5! Be humble and trade smart! Disclosure: Please be informed that information we provide is NOT a trading recommendation or investment advice. All of our work is for educational purposes only.
G
by ew-forecast
13
MATIC/USDT on the rise again? Odd.MATIC/USDT has turned up again in the last few hours (while I had the most beautiful, peaceful sleep after 3 days of international client meetings which entailed waking up in the wee hours to provide trade signals on my premium telegram channel - a 53% ROI in the last MATIC run). Based on the previous run which ended somewhat disappointingly (yes, I wasn't happy with 53%), there is a slight flat-lining to the trend. If it continues in this manner, I envisage an even more disappointing third run up. It is currently too soon to tell if this early rise is going to be another wave or a devious correction. Stay tuned for updates. On another note, I was delighted to find on my return that I have provided inspiration to some long-time posters who are now using a replica of my chart layout. I'm glad people are noticing me - it's a sign that I am doing something right. Although, I do hope they realise that my charts are only skimming the surface of the very deep technical analysis I conduct. ;)))))
M
by PurpleCrypto
Breaking down Bitcoin's correction & my tradesRight now is undoubtedly a time when Bitcoin enthusiasts & investors are glued to what the price is doing. I see all kinds of analysis, predictions (different from analysis), fund managers tweeting horrible looking technical analysis with a MACD and a few unconfirmed trend lines, drive by media reports from their “experts” and so on. To be honest, we are at a point as of this writing that has neither invalidated nor confirmed any kind of directional bias. As I’ve mentioned on twitter, I am not in any trades currently, and for a reason. The question for me then becomes, what scenarios am I looking at? where are my trades going to take place looking forward? what validates what? To do that, I first need to get a handle on what has happened, & what validates a trade for me. Corrective So far the only confirmation of any kind of correction being over is the 3-3-5 structure that ended at 9049. The yellow box is currently unknown. That corrective structure corrected the final leg (5th) of our rally by hitting a common Fibonacci retrace area (first image below). Looking at the overall rally (second image), we haven’t even come close to correcting any of the common retrace points. At minimum I want to see the .382 fib level hit. More commonly would be the .618, that being said the market doesn’t HAVE to do anything. Taking this overall picture, I now look at what has happened in our unknown area in the yellow box above. Coming out of the final 5 leg drive and painting a swing low we see a bullish OBV divergence (first image below). Taking it down to a lower time frame to study the rally up, we see the same div but no real significant spike in cumulative volume (second image). This tells me the rally was correcting oversold conditions & not a true impulsive structure that identifies the bottom of our correction. Taking this information I now want to look at the possibilities of what this is. Seeing a potential 5 impulse structure upwards with weak volume leaves a couple scenarios. At the end of this I will get into my trades and how I play each scenario. Scenarios Scenario 1: This structure is not impulsive looking at this time frame & actually a 3 drive with some long wickage throwing off the visuals of the structure. Really the structure is better viewed on the hourly and every fib level hit perfectly for a 5 impulse structure, but I omitted that for an overall scenario analysis. Looking at the fib retrace point to identify this possibility, I see it hit the .5 fib mark but fell short of a common .618 correction. If this scenario is true, then we should see a break of the low at any time leading to a violent drop to the 1.23 level at 8402 which is the maximum of a 3-3-5. However, this scenario now doesn’t make sense, remember we made 2 sets of ABC corrective moves to begin the correction, corrective patterns that start with a 3-3 end with a 5 unless it is a triangle. If the drop from 13222 to 9049 was wave 1, and this rally from the low was a corrective 2, then this is wave 3 and its minimum end point in a falling 3 is the 1.23 fib extension of 1. That would take us to minimum 6989 invalidating the maximum of 8402 in the 3-3-5. Again, markets don’t have to do anything, but technical analysis helps with deductive reasoning. Scenario 2: Since the above scenario doesn’t make much sense, we look at what the targets would be if the 5 impulse structure coming out of the low was an A drive. This correction currently is a B, and our targets are derived from the AB for the C. If this scenario is true, then we can confirm the larger corrective pattern at the end of C. I’ll get into what that is at the end of this scenario. The A wave commonly hits the .5 fib level of the prior trend, as I noted above, it did. Corrective wave B (our current structure) should be attempting to find a bottom. It has been hovering around the .764 & .854 fib level, these are common points. However in a flat ABC this can be up to 100%. There I have my invalidation point which also confirms funky scenario 1 by breaking the low. Taking this into account, we would make a five impulse structure up to either the .618 (minimum), the 1, and lastly the 1.23 fib level. Invalidation would be at the 1.618 in pink which confirms the bottom of the prior structure (we will get into that in scenario 3). Since the deep retrace level of this B (if we count the wick) then this looks more likely to hit the minimum .618 or 1 fib level. Scenario 2 is actually a big scenario since we are actually confirming a larger corrective pattern called a double combination. We confirmed the larger ABC talked about in the beginning, this corrective ABC we are forming would be the X of a WXY and the first correction is labeled as W. To confirm it as an X in a double corrective combination we need to see a swing high printed on the Daily of at least the .5 fib or any of the yellow fib lines below. Now I begin to see some collusion in this analysis, it so happens that the 1 fib of the C is actually at the .5 minimum of the W move. If this is the case, then at that confirmed swing high of the ABC, we take the fib extension and target 61.8%, 100%, or 123.6% of wave W to find our bottom. To speculate on where the bottom would be in this scenario, I have placed the end of X (speculation until a confirmed swing high) at that .5 of the yellow fib. We now can see some potential targets for the bottom that can be refined as the correction happens to a more exact point. Scenario 3: This scenario is bullish overall and that confirmed 3-3-5 ABC mentioned at the beginning was the bottom. Likelihood of this doesn’t seem high as we have issues with volume and overall structure but let’s look from an analysis point of view and identify the confirmation. Going back to the pink line I mentioned in the third paragraph of the last scenario, the pink 1.618 in the image below identifies this rally as a 3rd impulse considering we made a sub 5 in the potential A coming out of the bottom. It’s pretty simple to identify when it happens: If the daily continues upward without making a confirmed swing high to reach that target, then we have a confirmed bottom and the corrective A that I discussed in scenario two becomes a impulse 1. Conclusion & Trade Strategy So yes I get it, using Elliot Wave theory leaves open a lot of possibilities. I applied this as a means to make sense of the market, I still use Ichimoku, the ALPHA indicators and volume analysis when basing my trades, this correction requires additional detail which is what I have done. Also, the fib extensions in scenario 2 & 3 could adjust slightly if we break 9111, this is assuming that is the bottom in scenario 2 & 3 since there is not much wiggle room till invalidation from that low. On to my strategy… If scenario 1 confirms by breaking the low, then I open a market short on the break with a stop at 11120. At this point I feel something is wrong with the overall market & not operating normally. I am ok with a market order as a hedge there; Take profit and management will be done after. However, after doing this analysis I find this unlikely because of the invalidation that is detailed in that scenario. Either way, perhaps I have made a mistake somewhere along the line, if it takes place I’ll be prepared. If scenario 2 (I find this most likely) takes place, as a day trader I will long the first pull back of the rally, I use a number of technical confirmations to identify such and I will update this idea with those as they play. Scenario 2 has a 5 impulse structure in play like the first move from 9049 to 11120. So my long will be placed at the end of the corrective wave 2, with a stop at the current swing low (impulse 1). Take profit will be left open but as the .618 fib level is crossed I will manage the trade by placing a trailing stop with a tentative quantity of double the average true range indicators reading. At this point, when we get a swing high on the daily confirming the X wave of the larger double corrective pattern I will open a short to ride the rest of this correction to the take profit points I will update once that confirms. If scenario 3 takes place then I will be good and in a nice long, I don’t find this scenario likely yet. As possibility, this is why I am not placing a take profit in scenario 2 and rather using a trailing stop. Either way I am protected if I set my trailing stop right in scenario 2. Thats all for now, I will update this as it plays. I trade off of confirmation and currently we have none. The above details the possible scenarios and hopefully gives you insight into the way I do analysis and trade.
BITSTAMP:BTCUSD
by Nick_Core
46