TRX Break Out Failed, Possibly Heading Under 3 cents in 2024One of the most important things in trading is forego your own wants and want what the market wants. When Glenn Neely and I first came up with the x-wave idea for BTC, I did not want to believe it was true and I continued to WANT my diametric pattern to be the end of the bear market, as it had been for the last few months. As time has gone on it gets harder to deny that what we have formed over the last few months is an x-wave, on both BTC and TRX and the vast majority of crypto assets, and that we are only a little past half way finished with this bear market that began in 2021.
The market is probably going to go to max pain from here. That means another 1-2 years of bear market and the global crypto market cap being slashed in half over that time.
This is based almost entirely on the wave forecast, which indicates the bull market over the last few months is an x-wave. The reason why this is now being considered as an x-wave instead of the beginning of a new bull run is because we did not see the required confirmatory price action following the bottom in January. We should have seen moves much bigger and faster than wave-b, what we had, especially on TRX, was a move which is far smaller and far slower than wave-b. This is not what the beginning of a new bull market looks like.
In particular on TRX it looks like it has formed a contracting triangle after wave-g, which is very weak and not at all how a bull market should begin, but it does form into a very nice looking x-wave. This is likely to be followed by another diametric which could take just as long as the previous one, and will probably be slightly shorter, taking TRX to under 3 cents. After this happens probably sometime in 2024 we will begin to see a move bringing TRX above 1 USD and probably much higher than that. Momentum is also bearish on multiple timeframes including the weekly and the monthly. Neely River Theory has also not given any buy signals on TRX yet and remains in bearish territory.
On top of that, the regulatory issues in the US, and the lack of new money coming from other parts of the world like China is a major headwind for the whole market. A Wells Notice received by Coinbase at the same time the SEC sued Justin Sun implies that Coinbase will soon be charged with operating an unlicensed securities exchange, and may have to pause and seriously wind down operations until the court case is finished. The exact timing of when this lawsuit will be filed is not clear, but one thing is almost certain is they will be sued eventually after receiving a well's notice, and the comments made by Brian Armstrong indicate they are coming after their core spot business model. This is being considered as a possible regulatory trigger for this protracted bear market, however there are many other possible events which could cause negative headwinds especially from a regulatory standpoint, like Ripple losing their lawsuit or seeing it drag on for another year or two, and further ugly developments in Justin Sun's suit or other developers being sued. The reason this is significant is because it will seriously hinder new money coming in from the US, and short of mainland China opening retail crypto exchanges it's hard to imagine anyway that new money is going to be coming into the market at the same pace as 2017 or 2013. The lawsuits against Ripple and Justin Sun are also very significant because they hinder big developer's ability to effectively market their cryptos to US-based persons, or even through social media platforms like Twitter which may have US citizens browsing on there, opening developers up to liability if they advertise on these platforms or within the US, again severely reducing the flow of new money into the market, which is required for any real bull market to emerge.
Whatever the eventual trigger is for this bear market, most important to this analysis is the Wave theory which indicates, based on the rule of reverse logic, that we are only near the middle of this bear market and this could drag on until next year. As much as I didn't want to believe this at first and I wanted to assume even if we do get a wave down it will be quick, that is most likely not what the market wants. Based on the best wave analysis possible, all signs point to this going to max pain, which is a very deep, protracted bear market that could drag on well into next year.
The attitudes of many traders I have seen, especially to bearish ideas, are an echo of the peak in November 2021 which I called almost perfectly. The regulatory headwinds are also an echo of the SEC's DeFi crackdown which began in late 2021. And the wave theory and technical indicators here are clear and convincing, just like in 2021. Over leveraged crypto firms like Microstrategy and some BTC miners that are at risk of collapse during a protracted bear market are an echo of Luna, 3AC, and FTX. There may still be some small upside left in wave-x, but short of a massive breakout which would need to go almost completely vertical and send us flying past the velocity of wave-b (which is very unlikely), then we are probably going to form a top here very soon and begin a major decent towards max pain, finally squeezing out these over leveraged crypto firms and creating a temporary fire sale of cryptos.
