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Retrace

LTCUSD Perspective And Levels: Range Break Out.LTCUSD Update: This market breaks out above the 57 range high back into the mid 60s and is just below the 69 to 80 resistance zone. It is coming from a higher low at the 50 level (I wrote about this previously) which is a structure that implies further strength. I wrote about the failed low at the 50 level over a week ago and in light of the BTC rally this market has slowly worked it's way back to the top of the range and broke the 57 resistance which should not be too surprising since it came from a double bottom structure. The question is what to do from here? I like this market both for swing trade potential and as a long term investment. A retest of the high 50s (old resistance) should provide a new support upon any retest. This would be a good place for a swing trade long since risk can be defined by the 50 support level and a reasonable target in the low to mid 70's offers sound reward/risk in my opinion (around 2:1 at least). The old 57 resistance is now the .382 support of the new bullish swing which makes this level even more relevant for evaluating bullish reversal patterns on smaller time frames. The reward/risk from the high 50s is even more attractive in light of the 1.618 extension which happens to be the 84 level (this is based on the measurement taken from the recent bullish structure). Of course, a supportive BTC market will have to continue in order for this market continue working its way higher. IF BTC is in the middle of a serious retracement, and this market is testing supports, then I would not be so quick to buy. I consider a serious retrace at least 600 or more points on BTC. In terms of long term investment, I do believe in the merit of the technology and I don't think it is a bad idea to hold some as a core position with no target. If this market happens to offer the entry criteria that I am looking for, I plan to hold some as an investment as well. In summary, this market has been generally stable compared to BTC, and much more affordable than ETH. Also Fundamentally, this market is one that I believe in for the long term which is why I do not mind holding some as a core position IF my long criteria is met in the high 50s. If I see BTC selling off, I will avoid buying anything until it finds it's next level of stability and then reevaluate from there. So remember, IF this market triggers a long, there will be 2 strategies in play. The swing trade with a target in the mid 70s and a core position without any exit prices. Comments and questions welcome.
BITFINEX:LTCUSD
by MarcPMarkets
23
Slight GA Retrace Onward to July BreakGA is FLYING with no slowing down in sight. Bullish momentum will continue and we will break the July 6th high, I am looking for a re entry to the buy after the slight retrace i'm expecting. I did something unconventional with the Fibb retracement: from the established low i drew out the range to the July 6th high giving us great confluence with what happened at the 38.2 and 61 zones. Because of this i think the trend line to July 6th can be trusted and this retrace will be small yet provide the best entry as we take out the July high
Long
by Ketonian
ETHUSD Perspective And Levels: The Next Supports.ETHUSD update: Nice push into the 271 to 291 resistance zone off of the shallow higher low. Tough trade to take because of the risk, and now even more so since price did not clear the resistance completely. Bullish movements back up in the face of bearish structure is probably the most confusing for newer traders. Don't worry because if this market is going to present consistent bullish momentum, there will be more opportunities to get in even if the prices are higher. The problem with entering now is that price is sitting at a high, and still hesitating near the range of the resistance zone. The next retrace will offer a much better opportunity in my opinion compared to where it is now. The key to buying into this market is waiting to see how low the next retrace goes. Now that there is some bullish structure to work with, there are new reference points to consider. The first level that I will be evaluating is a retrace to the 260 area. Not only has this level been a key level during the major selloff, but is now the .382 of the recent bullish structure. If price can hold this area, and show a reversal pattern, I will be looking for a long swing trade with a target into the low 300s. If price falls through, then the next area is the 237 to 220 support which is the .618 of the recent bullish structure. I need to evaluate the price structure at the time in order to evaluate the risk. I must make this clear: I am not putting buy orders in ahead of time. I am waiting to evaluate the price action IF the market revisits these levels. This market may not retrace at all and start pushing higher in which case I will NOT enter any position. Also since the current move up has not completely cleared the resistance zone, this market still has a good possibility of falling through the supports to test the lows (Remember Wave C?). What is good about the current price structure is it's showing the possibility of momentum changing, but it has yet to prove itself. One negative catalyst and these supports will vanish. That is why as short term traders we evaluate risk and use stops. Also I must add IF another dramatic sell off materializes, the extreme prices will present investment opportunities for those who are interested in long term (AS IN HOLDING FOR YEARS). It is a completely different mindset and strategy from short term trading but I feel is worth mentioning because it requires much less precision. Just make sure to keep the strategies separate. Each one has its own plan and risk parameters, if you do not have any type of plan, then you should not be in these markets to begin with. In summary, do not be frustrated by the recent upswing. Be happy you weren't short. Since price is hesitating within the projected resistance zone, I believe there is a better chance it retraces. If it can retrace back to a projected support level, and show some reversal confirmations on smaller time frames, then risk can be evaluated and setting a target in the low 300s is reasonable. Reward to risk should be no less than 1:1. And remember these supports are minor relative to the bearish structures that are currently in place. If they hold, great. If they break, then be prepared for the possibility of another test of the extremes, (which is not a bad thing if you are an investor). In the big picture, these markets are not that bearish, they just need to stabilize which may call for some range bound price action for a little while. The market will let us know. Comments and questions welcome.
BITFINEX:ETHUSD
by MarcPMarkets
20
OMG USD trendlines, recalc fib retrace, new resist and buy zonesI WRITE SHORT, because this is looking at immediate future. This overall analysis (longer term) is LONG. This is a very bullish coin. These are estimates with trendlines for new resistance zones, and potential buy ins if not already invested. Still consolidating, reaching new high gives us new targets. On the chart we see some patterns developing. Previous support lines will turn resistance, and we might see a near bottom channel drop. Once we resume ,we have new targets set up for our long. $15 now becomes $15.60 (I use 80%). $17 now likely. Above are long term estimates. In the short term duration, expect the resistance to apply and the chart to stay within trend channel. If anything crazy occurs, and OMG breaks SOUTH of trend channels, and you are not invested yet, I have wrote down some very good buy in zones. 50% and 61.8% are the best retraces for further continuation patterns. If it breaks below these, we are no longer trading fibonacci patterns. But if bounce happens at one of these, great opportunity to buy.
BITFINEX:OMGUSDShort
by Shwayze
ETHUSD Perspective And Levels: When To Buy?ETHUSD Update: 296 support broken, and no signs of reversal. If price cannot stabilize and continues into the next support areas, that will signal this market is more likely to consolidate rather than reach new highs any time soon. The 296 support is the .382 of the entire recent bullish structure. I wrote in my previous report that this level was more likely to be revisited in light of the Shooting Star like pattern on the weekly time frame. The fact that the low was taken out means bearish momentum is in effect and will continue until the market can show a significant sign of reversal. An example would be a Hammer or any variation of a pin bar with a long wick on the bottom on the weekly time frame. The next support zone is the 233 to 196 area which is the .618 of the recent bullish structure. If this zone is reached, it indicates that this market is fluctuating within a broad Wave 2 consolidation (see weekly chart). This scenario will require closer attention to shorter term targets until the market breaks out on the bigger picture. The other support level worth noting is the 260 area which is an old resistance (inversion) and high of Wave 1 of the current bullish structure. Keep in mind, these levels are reference points to evaluate for reversal patterns and stability, not to place blind entry orders. Also remember it is better to buy when the momentum reverses rather than buy cheap because without momentum on your side, price is likely to get cheaper. Bottom and top fishing are very expensive efforts as many of you will learn the hard way. With that being said, in order for this market to prove that buyers are firmly in control, the newly formed 320 resistance area must be taken out. This is the .382 of the current bearish swing. As price goes lower, this level will adjust as well. So there are a couple of ways you can play this. You can start buying small into the weakness and take the pain until price eventually stabilizes and begins to build bullish momentum. Or you can let the impulsive market crowd deal with the stress and uncertainty and let their order flow develop into a supportive price structure that signals higher prices. Waiting for the second scenario means you will not get the best prices, but you will also not have to deal with the pain. It's is up to you. I am waiting for price stability. At the moment there is no sign of that and I don't mind not catching the bottom. I want price structure to be supportive, and I want to be able to clearly define my risk based on the structure and until the market let's me accomplish that, I just sit this out and wait. In summary, the weekly Shooting Star trigger offered insight into the current selling momentum. The 260, 233 and 196 areas are the next levels to observe for any supportive price action along with a reversal. As a swing trader, I look to buy weakness and sell strength and there is plenty of weakness now. It is just a matter of waiting for stability to appear and then evaluate the risk at that point. And this does not mean I will get the lowest price, it means I will get in when the market favors bullish momentum. Comments and questions welcome.
BITFINEX:ETHUSD
by MarcPMarkets
63
ETHUSD Perspective And Levels: More Selling Momentum.ETHUSD Update: Price retraces off of the 326 support up to the new 370 resistance level only to turn back and revisit 326. Great day trading price action, but not very appealing if you are considering longer time horizon strategies like swing trading. This bearish momentum points to the 296 level as the next support to test. I mentioned the 326 to 305 zone that price retraced nicely off of, and ran almost 50 points within hours. If you are day trading this market which I am not, there is a lot of opportunity in movements like that, but if you are trying to buy into this and do not plan to take profit within the day trading time frame, then you need to be prepared for some pain. And here is why: Tonight is the close of the current weekly candle. It has a long wick on top, and this is known as a Shooting Star which is a bearish reversal pattern. It is especially bearish in this context since it carries the weight of the weekly time frame and is appearing near a major resistance area. Once the low of this candle is taken out, bearish moment is more likely to follow and it can persist for at least a week. This does not mean this market is in a bearish trend. Trend and momentum are two different things. It means that the current retrace has more room to test lower levels. If I am going to buy into a reversal pattern, I prefer to buy when the bearish momentum is more than likely running out of steam. In order for me to consider this market bearish on the big picture, 208 would have to be taken out and we are no where near that. So in this scenario, I am waiting to see if this market can test the 296 support which is the .382 of the major bullish structure. Even though a double bottom reversal may be forming at the 326 level, the weekly Shooting Star carries more weight. Also any bullish retrace from here will now have to contend with the newly formed 368 to 380 resistance zone which is related to the .618 of the recent bear swing. This zone is a good reference area for short term targets. Keep in mind, the way I am evaluating this market and choosing to trade it is not the only way. Some traders prefer to start buying small amounts early and build a core position to insure that they do not miss the next bullish move. There is nothing wrong with this as long as you know how to manage risk and not get too big too fast. If you have limited experience, this is not a good idea because inappropriate sizing will most likely force you out at the bottom. In summary, buying into a pullback too early is common and I always look for signs that indicate the potential of the retrace. This retrace still has bearish potential as highlighted by the Shooting Star formation that will be official at the close of the weekly candle. With this perspective I look to the 296 level as offering a more attractive area to start buying back into this overall bullish market. IF 296 is reached, I will be looking for reversal patterns, if instead it is broken, I will reevaluate the price action and adjust from there. Questions and comments welcome.
BITFINEX:ETHUSD
by MarcPMarkets
39
ETHUSD Perspective And Levels: Where's The Support?ETHUSD Update: Correction unfolds as anticipated, but at a much larger magnitude which calls for a wave count adjustment. The next support levels for potential reversals are 326, 305 and 296. I have been writing about it for over a week. My caution and concern kept me out of this market even though someone actually insisted I was "losing money" by waiting. I reiterated that the risk was high, and for those who are blindly driven by greed, the market will teach you this lesson just like it taught me over the years. In case you don't know, compared to the market, I am a much more cost effective instructor and nicer too. I am sure many are wondering "What is going on?" and scouring the forums and news to look for any related information. BTC, along with the other coins have retraced significantly within a day. Out of no where the "follow the leader" relationship reasserts itself. The beauty of price action and TA in general is it doesn't matter why, The market discounts everything, and whatever is shaking out the reactionary weak hands is a normal and healthy sign. I don't even need to know why. What I need to do is be prepared to buy back in at the right time and price. So let's talk levels. The supports at 365 and 350 were taken out with some hesitation, but none the less, taken out. Remember when I mention levels, they are reference points to observe further validation (something the people with very limited knowledge fail to understand). Validation means we are WAITING for reversal patterns, not buying blindly and then wondering why the price just fell through. If the reversal never comes, or fails, then we look to the next level. At the moment, the 326 to the 305 support zone (.618 area of recent bullish swing) is the next area I am watching for a bullish reversal that I can measure risk from. IF price falls below this range, 296 is the .382 of the entire bullish structure and needs to hold in order to argue that this market is still bullish and not going into a broader consolidation. In terms of Elliott Wave, this is NOT the beginning Wave 4 which I was expecting and writing about since we had 5 subwaves of the previous Wave 3 complete. The problem is in order to call this current structure a motive wave, the current retrace should not overlap into the area of the proportional Wave 1 and it has (red dotted line). Since the rule has been compromised by the market, I was forced to relabel my count. Instead of Wave 3 of 5, that entire up leg completed 5 of 5 waves. That puts the magnitude of this current retracement into a new light. Another lesson about Elliott Wave is even though I was wrong about the anticipated magnitude of the current wave, I was right about the direction and the methodology has proven to help me avoid getting caught in a losing trade once again. Now that I have perspective on this magnitude, I know that this correction may be part of a very broad Wave 2. And if I get any reversals to go long, I know to expect very conservative targets unless the support level is extreme like 296. Even then, if the market manages to retest that level and I buy, I will unload most of the position into the mid 300s. Since we never took out the high of the broader Wave 1, the current 5 wave structure may be the fist leg of a very broad Wave 3 or a Wave B of the broader Wave 2. Either way, those counts point to a bearish wave which means there is more of a chance we retest lower levels before stability returns. In summary, the crowd is always wrong at tops and bottoms. Whenever you read about outrageous targets and euphoric sentiment, that is usually an anecdotal sign of a top and there has been way too much of that in these markets recently. The swift retracement is larger in magnitude which may lead to significant selling if there is no stabilization at anticipated support levels of 326, 305 and 296 so I am just going to wait it out. Questions and comments welcome.
BITFINEX:ETHUSD
by MarcPMarkets
49
LTCUSD Perspective And Levels: Bullish Momentum And New Target.LTCUSD Update: The 70 to 73 area target has been taken out upon new all time highs. Wave 3 of 5 continues with the 84 level as the next proportional target, but don't forget, as price goes higher, risk goes higher also. This market along with a few others like ETH and BTC are in a relentless uptrend that is obvious. What you do not want to get caught in is the euphoria surrounding these moves. There will be all kinds of overly optimistic reports saying that these markets are going up forever, with all kinds of outrageous targets. When this sentiment reaches extreme, that is usually a sign of a top. That goes with the saying, the crowd is always wrong at tops and bottoms so I am certainly a contrarian at these levels. Even though I will not get caught up in the hype and not buy into highs, this market is worth evaluating for proportional targets and support levels that would offer attractive buying opportunities IF price revisits them in the near future. The market will eventually retrace, all markets do, and when that scenario unfolds, I want to be prepared with a solid plan instead of reacting like the market crowd. As the market rises, the potential levels that would serve as reference points to look for entries will also adjust proportionally. At this moment 65 is the .382 of the current bullish swing and the 55 area is the .618. These are the levels that I would look for if the market retraces off these highs. If price can revisit these levels, that is when I would be looking for bullish reversal patterns for a risk assessment and entry. Targets, just like support levels are proportional to the current price structure and the 84 area (which is the 3.618 extension of the subwave 1) is the next target and may be reached before a significant retracement materializes. The other perspective to consider is Elliott Wave. This is a Wave 3 of 5 that shows no signs of bearish momentum or weakness at the moment. If I was long, I would be selling some into this strength, raising the stop and holding on to a small portion of the position to see how price behaves around the 84 target area. The only thing is there are 5 subwaves that are complete which forces me to sit out and wait for the Wave 4 correction. Waiting out while the market appears to be going straight up is probably one of the most challenging situations we face because of the internal struggle of not wanting to miss out. The solution is stop focusing on the profit, and instead focus on the risk. Buying highs may work once or twice, but as some of you know, eventually you will get hammered and if you don't believe me, it's okay because the market teaches this lesson often. In summary, this market is clearly strong with no signs of pull back or weakness at the moment. Great if you are in, but more risky if you are out wanting to get in. Price may rise to the 84 target area before showing any possibilities of a retrace, but in my opinion, as price rises, risk rises as well. The best I can do is prepare myself for when the market retraces by having specific levels to anticipate, and entry criteria for those levels. The current wave count also shows 5 complete subwaves which I interpret as an increased chance for pull back, it is just a matter of waiting it out. And if it goes dramatically higher, I simply adjust my levels and continue to wait. Remember successful speculation in any market is not about being right, it is about stacking probabilities because that is all we can control. Everything else is up to the market. Comments and questions welcome.
BITFINEX:LTCUSD
by MarcPMarkets
30
ETHUSD Perspective And Levels: Strong But For How Long?ETHUSD Update: Price is holding, but the failed breakout and lack of progress above 349 is concerning and highlights the risk at these levels. When strong markets break out, this usually attracts more order flow. ETH is a market that is closely watched, and the failed breakout above 349 is concerning because where are all the buyers? I realize these markets may be slow and do not behave exactly like the other financial markets, but to me, this price action is a red flag. On the bullish side, there is a new higher low in place at the 334 level and the market looks like it should test the highs again. Upon a subsequent break out along with follow through this market should make an attempt to test the 380 resistance. If it fails again, then I would steer clear of any new longs until a retest of a significant support level like 309 or below which is now the .618 of this bullish swing. The reason for my growing concern about this price action is this: price has been sluggish within the 324 to 349 resistance zone which is related to the .618 of the broader bear swing. The fact that it is having trouble breaking out of this zone makes me more cautious because this area is a very convenient place to form a big picture failed high. If this scenario unfolds, we are more likely to test supports that we have not seen in a while like 270. This is not a prediction, just a concern because of the way price is behaving at these highs. This market is not bearish because it has not taken out any support levels that would signal that type of environment. The problem is if it's not pushing highs soon, it will become vulnerable to any piece of negative news and the selling momentum will be high. And for that reason, the risk of buying at these levels is just too high for me. In summary, this market is slowly inching higher and still has supportive structure in place, but the lack of follow through is concerning because from my experience it implies an increased potential for weakness. Keep in mind, I am sharing my perspective and how I make decisions based on price action. I am not telling you what to do. I don't control your account, you do. And if you are comfortable taking the associated risks, then you don't have to wait it out like me. I would rather be wrong about being out, than wrong about being in. Questions and comments welcome.
BITFINEX:ETHUSD
by MarcPMarkets
33
ETHUSD Perspective And Levels: Waitng For Retrace.ETHUSD Update: Price action is stuck within the 324 to 334 minor resistance zone. I am still waiting for a retest of the 306 to mid 290s support for an opportunity to buy back in. It is a waiting game. At the moment price is fluctuating with no progress in either direction. These coins seem to take turns and go in spurts, and in order to attract order flow, this market needs some positive news. The fact that it lost momentum within the current resistance zone is a sign that it has more room for a correction which can lead price into the 306 support area. I have mentioned it in my previous report, and I will mention it again. In terms of Elliott Wave, corrective waves typically unfold in 3 legs. The third leg, which is Wave C, is often an emotional wave that contains 5 distinct subwaves. Since this market has not made any progress upon revisiting the current resistance, I believe that the subdegree Wave 2 needs to complete a Wave C which can lead price back to the support area that I have been patiently waiting for. If this happens, great. If not, and it goes higher without me, that's okay too because I have nothing at risk. I do not know when this market is going to break out to the upside. All I know is the bigger picture price structure continues to indicate strength, even in the face of a minor correction. A break of the 338 high will signal the continuation up toward the next resistance which is the 380 area. And since there is a lack of momentum, there is a greater chance of false breakouts which is why I do not buy into these. The best anyone can do is come up with a number of likely scenarios and prepare for them. I do not prefer to buy breakouts, I prefer pullbacks and I am prepared to miss this move if the market cannot provide an attractive level for me to enter. I am also prepared to buy if the market offers the opportunity that I am looking for at the 306 level or just below. I let the market tell me what to do, I do not impose my own ideas on the market. Also I get a lot of questions about this so I want to make it clear. I do not place blind buy orders at the support just because my analysis says there is a level at a particular range of prices. IF price reaches my support, then the market has my attention. That is when I look for some form of validation like a reversal pattern to justify a long. This is the process that helps to stack probabilities in my favor. If I just place blind buy orders at the level, my outcome will be random. Many participants who have a very limited understanding of technical analysis seem to think it is about absolute predictions, or expect precise answers or instructions. The best we can do is uncover clues and align our intent with the intent of the market to achieve a positive outcome. And charts offer tons of clues in order to do this effectively. If price retraces to my anticipated support area, and I manage to get long, my stop will be placed around the high 280s and my targets will be set around 345 and 370 levels. The reward to risk even without having exact prices is still over 2:! which is acceptable. In summary, this market is still poised to go higher in the long run, but is hesitant. Current Wave structure points to a higher possibility of a Wave C which can lead price back to the 306 area. IF that scenario unfolds, I will be looking for buy signals. If on the other hand price pushes beyond the 338 level, it can work its way up to the 380 area, but at this rate, I can't justify the risk at these prices. Speculation in any financial market is far from an exact science, and any professional evaluation will provide multiple scenarios because the goal is to be prepared, not to impulsively react. The market will decide, and then we adjust to the new information. Comments and questions welcome.
BITFINEX:ETHUSD
by MarcPMarkets
28
ETHUSD Perspective And Levels: Corrective Wave 300 Support.ETHUSD Update: Corrective wave in play with one more leg to complete which can lead to a retest of the low 300's. A break above 334 will signal the next leg up is in progress. In terms of wave count, we are in the C wave of subwave 2. C waves are usually impulse patterns and often make people uncomfortable. We have nothing to worry about because upon completion of this wave, there may be an attractive buying opportunity. I am looking for this wave to complete in the low 300's, or even possible mid 290s. In that price range there is a .618 minor support that is relative to the most recent bullish swing. So it would be a convenient area to look for reversal patterns such as a double bottom on a smaller time frame. The next leg up should be the subdegree Wave 3 which in terms of proportion can lead price into the 380 resistance area or higher. A long taken in this area would prompt me to place a stop in the mid 270s, and targets at the 345 and 374 levels. Why two levels? Because once I'm in a trade, my goal is to reduce risk and locking in profit along the way is one way I do that. We have no control over profit targets, the market may or may not reach them, but we can control our risk. As you learned from my previous trade, I turned it into a risk free trade as soon as the market let me. It took me a long time to learn this lesson, but the focus on trading should be on making a good trade, not the profit. Profit follows good trades. It is counter intuitive, but if you manage to gain enough experience, you will eventually understand this. In summary, this market is still poised to go higher in the long run. As long as the 279 and 263 supports hold, chances are we push to new highs sooner than not. At the moment we have one more leg of the corrective wave to play out which can complete in an area that may offer a buying opportunity. I have been saying this over and over, all this market needs is a good catalyst to capture the attention of investors and the next upswing will materialize quickly. Comments and questions welcome.
BITFINEX:ETHUSD
by MarcPMarkets
38
ETHUSD Perspective And Levels: Corrective Wave Appearance.ETHUSD Update: Larger than expected retrace alters wave count and offers good lessons about price action and trade management. Outlook is still bullish as long as supports are maintained. Wow, what a wild move. This is why I always remind everyone "anything can happen". In terms of wave counts, this move changes the structure because Wave 4's do not overlap the area of Wave 1's. If there is overlap then it is not a Wave 4, which has prompted me to relabel the waves. The large move up is relabeled as subdegree Wave 1 and the current retrace is subdegree wave 2 of the larger 5. This is the subjectivity and imperfection of Elliott Wave, but then again nothing is perfect, especially in the markets. As price action traders we understand this and simply ADJUST. The market is always right, we are just trying our best to listen. There is no room for ego in this game. Even though my original wave count (current move to 350 as subdegree Wave 3) was negated by the current retrace, it still manged to get me into a very good trade. I sold half of my position at 345 as reported yesterday and I was stopped out for the other half at 306 for a 12 point profit. I was willing give back some profit for the chance to participate in the broader move. Like one of my former mentors used to say, "Sometimes you get the elevator, and sometimes you get the shaft." The question now is where to from here? My adjusted wave count places this market in a subdegree Wave 2. Which is good and bad. It's good because it can be setting up for another subdegree Wave 3 which can take us to the 380 resistance that I have been writing about. It's bad because corrective waves usually unfold in 3's and at the moment there is only one leg in place. Which means the minor resistance in the 324 to 334 area is likely to lead to range bound price action with support at the 290 to 295 area. The 279 and 263 supports are the main structures that keep this entire formation bullish. As long as they hold, I will be looking for ways to get long. The 334 and 350 resistances need to be taken out in order to signal the new subdegree Wave 3 is in play and again it is all a matter of time or catalyst. In order for me to buy back into this market, I need to see some form of reversal structure like a higher low or double bottom on this time frame. And it needs to occur within the 290 to 334 range. In summary, we must always maintain flexibility and an open mind. Financial markets possess an element of randomness and this is why nothing is ever 100%. We listen, and as the market provides new information, we adjust. Elliott Wave may be imperfect, BUT it kept me on the right side of the market and that is really all that matters. Current structure puts this market back into a subdegree Wave 2, which means there is still potential to reach the 380 resistance area in the next leg up, BUT two more corrective legs are likely to unfold first. Trading effectively is not about being "right" it's about managing risk in the face of constant uncertainty. Comments and questions welcome.
BITFINEX:ETHUSD
by MarcPMarkets
23
ETHUSD Perspective And Levels: Head And Shoulders Reversal Sign?ETHUSD Update: Head and shoulders formation appearing under the 306 resistance. Is this a sign of a reversal? How does the BTC pullback factor in? I will address these questions. Also the magnitude of this consolidation has prompted me to reevaluate my wave count. First is the head and shoulders which most of you know is a bearish reversal chart formation. Yes it is a bearish sign, but as I have mentioned in other reports, I do not give much weight to smaller degree formations in the face of broad bullish trends. As bearish as this may look, no supports have been taken out yet. This helps me not to short strong markets, and I learned this lesson the hard way, by shorting strong markets that would suck me in with bearish chart patterns. If you are long, just remember the supports and the BTC relationship will be a better guide in my opinion. The support levels that are still in play are the 279 and the 263 levels. I have written about these extensively in previous reports. If 263 breaks, it will signal a larger consolidation is in play rather than a broader bearish trend and will open the door to the 230 support area. IF this market were to break 208, that would put the broader trend in question. Now about the wave count. Some people have asked me about how I counted the current bullish wave and I explained my reasoning behind my Wave 3 extension, but as it turns out, the extension appears to be a subwave 5 of a larger 3. Which means we are in a larger degree Wave 4. Even though my original count was slightly different, it did not change the anticipated direction, only the expected magnitude of the current Wave 4. And that is why I do not get caught up in exact wave counts. When the market prompts me to adjust, then I adjust. There were some traders who picked up on this current wave count before the market made it obvious, thank you to the people who pointed this out. The larger degree Wave 4 puts the 263 support level into perspective. A bullish reversal off of that level would be a convenient spot for the larger degree Wave 5 to begin. The larger Wave 5 can take this market up into the 350 to 380 area and that is going to be my target. Risk will have to be determined once this market shows some price stability. This takes me to the BTC relationship since there is a lot of varying opinions on this. BTC has been retracing to a larger extent, and as expected, this market is following. Now some may be watching these currencies against BTC as a pair, and sure if BTC is declining at a faster rate, the price on that chart will go up. I am not watching those, I am watching against the US dollar. Why? Because that is my base currency which means that we cannot forget to consider the strength and weakness of the USD. The dollar has been weak, but if you look at recent activity, it is in the process of retracing back up which should exert more pressure on the BTC pullback. All the markets that have been relatively weak against BTC as it pushed highs are now pulling back significantly, like LTC and XRP. My point here is it's more than just a BTC/altcoin relationship. It's more like BTC/Altcoin/Fiat relationship. Something to keep in mind. In summary, this market is in a larger degree Wave 4 which in my opinion is the most predictable wave. There is room for one more leg up (Wave 5) which can push prices up into the 350 to 380 area. I am not predicting this event, instead I am gathering clues that support the likelihood of this scenario. 263 Is the key support I am watching for a bullish reversal along with price stability in BTC and weakness returning to the dollar. If it sounds confusing, remember keep it simple and evaluate one market, I just refer to others for clues. When this market heads back up, signals will present themselves. Comments and questions welcome.
BITFINEX:ETHUSD
by MarcPMarkets
22
BTCUSD Perspective And Levels: More To This Retrace?BTCUSD Update: New all time highs, which should not be a surprise. The question is: Is the current retrace a minor one? Or does it have room to test lower supports? Elliott Wave provides some interesting perspective to help answer these questions. First I want to mention ETH for a moment. I was debating whether I should write up another ETH report, or BTC, or even ETHBTC which one trader suggested (I took a look at it). I chose BTCUSD not because it is wowing the media and the markets, but because I want to point out there is a relative strength relationship compared to ETH. If this was inverse as some suggest (investors selling BTC and buying ETH with their profits) then ETH should be testing resistance, not supports while BTC retraces. I have been writing about ETH weakness concerns while BTC has been pushing highs for days now. Let's talk about BTC which is the leader, and the base currency of this market in my opinion. 4190 is the new all time high, which I am sure is being spread everywhere by the mainstream and non main stream media like wild fire (I haven't looked at any articles yet, but I can only imagine). I'm sure they will be predicting BTC 5k is just around the corner! Please do not get sucked into this hype. Observing this market from the Elliott Wave perspective, we have been in a subdegree Wave 3 of a broader 5. Within this subdegree 3, 5 minor waves can be counted which signals completion. To add to the argument, I measured the subdegree Wave 1 to the bottom of 2 with the extension tool, (it is not on the chart for simplicity sake) and there is a 1.618 extension around the 4112 area. This is very significant because this is a common Wave 3 completion point relative to the degree being measured. According to the same measurement, the next completion point is around 5164. A push up to the high 4000s or the low 5000s would be a proportional target for a large degree Wave 5 to complete.I would not get overly excited until the next corrective wave is in place and that is what I want to highlight in this evaluation. To answer the question: Is this pullback minor? Or is there more too it. Based on the wave count, this is most likely the beginning of a Wave 4 of 5 that can retest levels as low as 3500 before going higher. To help confirm this scenario, the 3820 support (.382 of current bull swing) must be taken out followed by other bearish structure like a failed high. If 3820 is not broken, then Wave 3 of 5 is still unfolding and this market is more likely to retest the high. In summary, this market is clearly strong and has all the structure to reasonably expect higher prices. That can change quickly and there are levels in place that would signal a broader retracement is in play. I am keeping a close eye on 3820 because a break below opens the door to the possibility of retesting the 3530 support area which would be a very attractive buy price in terms of structure. And I can use this information to help time my entry into other markets like ETH. Comments and questions welcome.
BITFINEX:BTCUSD
by MarcPMarkets
13
ETHUSD Perspective And Levels: New Support For Longs?ETHUSD Update: Higher high established at 316 with a minor retrace unfolding. There is a nice motive wave formation that can provide clues as to how much further this market can go before a more significant retrace. I have been writing about the 250 to 280 resistance zone which this market pushed through without much hesitation taking it into the 306 to 349 zone which is the .618 of the recent bear swing (which I have written about in previous reports). Price finally peaked in this zone, but what is a reasonable expectation for the low of this retrace and a target for the next leg up? I am going to use Elliot Wave to answer this question. Before I get into the wave count, I need to highlight the support level at the 242 level (inversion). For those of you who follow my reports, you will recall that 242 was a major resistance that needed to be taken out in order to make new highs. In light of the recent bullish structure and momentum, this level is less likely to be reached anytime soon. The level just above this at 262 (.382 of recent bullish swing) is a more reasonable possibility. If price reaches 262 it would present one good area to look for reversals back up. From the Elliot Wave perspective, we are in a Wave 4 of a larger degree Wave 3. Wave 3's are never the shortest wave, and this recent upswing fits within that basic rule. Since this is a minor degree Wave 4, it is reasonable to expect a retracement of relative proportion. The 279 level (.382 of Wave 3 swing) presents a proportional level to look for a minor Wave 4 completion and start of 5. The Wave 5 of 3 can take this market into the higher part of the resistance zone in the 350s which would complete the larger degree Wave 3. Once this happens, we then face larger degree Wave 4 which is a broader corrective structure. The wave count is clearly bullish and I have been patiently waiting for an attractive level to enter. A market that grinds higher is a tough one for me because of the nature of my trading plan. Now that we are in a minor Wave 4, I am closely watching the 279 support for a reversal on a smaller time frame like an hourly. If I manage to get long there, my stop will be in the mid to low 250s. My target for this would be a new high into the 330s. That is risking about 25 points to make about 50, or 2:1 RR which is acceptable. In summary, the current retrace in this market can lead to a buying opportunity around the 279 level. Barring any fundamental surprises, the strength of this market should take price into the mid 300s upon the completion of the minor wave 4. Once the next leg up finds it's peak, the following corrective wave will be a much larger degree, so I would like to be out of the market before then. Comments and questions welcome.
BITFINEX:ETHUSDLong
by MarcPMarkets
23
BCHUSD Perspective And Levels: Upswing To Key Level.BCHUSD Update: This market has gone from the 190s back to 350 within 48 hours and is worth evaluating because it offers attractive short term trading opportunities at the newly developed support levels. I have not updated my ETH chart because I would just be repeating myself, it has only gone slightly higher while still in a resistance zone. Meanwhile BTC and BCH have been presenting much more interesting price action. When BCH started out in the 600s, it immediately sold off and had no buyers in sight until it formed a double bottom in the 190 area and reversed just two days ago. Since it took out the swing high at 254, it now has a solid bullish reversal in place. This is all old news BUT important to recognize because this is a nice example of a bullish reversal. This is what I like to see happen at support levels in strong markets. This market now has newly developed support levels which can offer some excellent day trading or swing trading opportunities upon a retracel. The nearest support is the 329 to 318 zone which is related to the .618 of the minor upswing off the 307 low. Since this is a small structure, this support is minor but a retest and reversal on smaller time frames make it attractive for day trading. A reversal off this level with a target in the 350s to 360s offers attractive reward to risk if using the 315 as a stop. The next support is the 298 level which is the .382 of the recent upswing. This support is important because in order for this upswing to continue, price must stay above this level. A retrace and reversal off of this level is attractive for a swing trade because a reasonable target would be a higher high which can be well into the 400s if this momentum persists. If this market presents a deeper retrace then the next supports to watch are the 270 level and 254 to 224 zone. 270 was an old resistance that should now act as a support especially with the 254 zone just below. The 254 to 224 zone is relative to the .618 of the recent upswing. IF price reaches these levels, then I would not expect a higher high to follow, I would expect a more conservative target like low the 300s and more of a consolidation to follow. The key resistance level that still qualifies this market as generally bearish by my evaluation process is the 381 level. So this means at the moment if price cannot compromise this level, and retraces to the supports mentioned, then those supports have a lower chance of holding with a broad lower low still possible. This is why it is not the best time to buy and hold this market in my opinion. If price breaks 381 to the upside, that signals that the broader bearish momentum is declining and the new support levels should have a better chance of holding. In summary this market is showing some signs of strength with the significant move off of the 190 low. In order to form reasonable expectations of this bullish momentum to continue, 381 needs to be compromised. Keep in mind it is very possible to have strong upswings in the face of a bearish trend, and often initial moves like the one can mark the beginning of a new trend. Also trading against the bigger picture (buying supports while price has not broken 381) is still a viable strategy as long as the right expectations are in place. This is why short term trading strategies like scalping and day trading have a lot of potential in markets that move like this one. Questions and comments welcome.
B
by MarcPMarkets
4