Bitcoin Targeting $10K Before a 300% Rally?

A Historical Perspective

In this article, I will take you on a journey using the Elliott Wave Principle (EWP) to try to better understand Bitcoin’s (BTC) past, current, and future price action. The longest record of BTC’s price started in July 2010. See Figure 1 below. Before that, the first recorded price of Bitcoin was $0.00099.

Namely, on The BitcoinTalk forum, member NewLibertyStandard set up New Liberty Standard Exchange, and another forum user – Sirius – sent him 5050 BTC in exchange for $5.02 through PayPal. Thus our analysis starts on July 19, 2010, when BTC was recorded at $0.09.

Figure 1. Bitcoin historical price chart with detailed EWP count and technical indicators.

From there, we can count five waves up to the June 2011 high: (Pink) Cycle 1. BTC lost around 90% over the next six months: Cycle 2. The cryptocurrency moved in five black (major) waves higher from that low to the 2013 high: Blue Primary I. It bottomed in early 2015, losing around 80%: Primary II. The next five-wave advance caused a high in December 2017: Primary III. The next low was a year later: Primary IV. Again BTC had lost ~85% of its value.

Ultimately, BTC topped early November 2021 at $69K after another five waves up. That high was Cycle 3. It is currently trading at $16K—a 77% decline. The current fall is nothing out of the ordinary and has likely further to go based on the past three declines. The above-described pattern, EWP path, can also be captured with a simple yearly-resolution chart. See Figure 2 below.

Figure 2. Bitcoin yearly candlestick chart with EWP count.

Applying the EWP count as in Figure 1, the annual chart shows BTC is most likely in a more significant (blue) Primary W-A, which W-B will follow, and -C to complete all W-C4. Namely, 4th waves are corrective and thus travel in at least three waves, never five. The monthly chart, see Figure 3 below, corroborates the yearly and entire-price-action charts’ EWP counts.

It tells us BTC is most likely in the last (red W-iii, iv, v) waves to around $10K+/-1K before a more significant multi-month counter trend rally (blue W-B) should start. The dotted blue arrows show the anticipated path (inaccurate in time).

Figure 3. Bitcoin monthly candlestick chart with detailed EWP count.

This counter-trend rally targets ideally the 38.2-62.8% retrace of the entire prior, now over one year long, decline: $30-50K. From there, the final crash wave, W-C of W-C4, will take hold and bring BTC back to around $6K+/-2K. The cryptocurrency will, by then, have given back most of its gains since the 2018 low, which is consistent with the prior percent losses (~90%).

Besides, the EWP tells us “a one-degree higher 4th wave often bottoms in the territory of the previous one-degree lower 4th wave”, i.e., Cycle 4 vs Primary IV.

Current Price Action Suggests a Low of Around $10+/-1K

Figure 4 below shows the weekly candlestick chart of BTC, where each candlestick represents one whole week, and the current price action suggests the cryptocurrency is now wrapping up red W-iii, iv, and v of black W-5 of blue W-A. That means the decline from the November 2021 all-time high was five waves, and we should expect all of W-C4 to become a zigzag. A 5-3-5 pattern.

The red boxes show the ideal Fibonacci-based target zones for red W-iii, -iv, -v. It follows a low at around $10K+/-1K should be expected. From there, blue W-B should then commence. Last several months and top out at about $30-50K, depending on where exactly W-A will bottom. But for now, we have some excellent initial downside and upside targets to work with: anticipate, monitor, and adjust.

Figure 4. Bitcoin weekly candlestick chart with detailed EWP count.

Since the devil is always in the details, it is also prudent to look at the daily resolution chart. See figure 5 below. Since Elliott Waves are fractal, i.e., self-similar or repeating patterns, red W-iii consists of five smaller waves: green W-1, 2, 3, 4, 5. BTC is currently working on the W-3, 4, and 5 sequences. The dotted green and red arrows show the anticipated ideal path forward (inaccurate in time).

Figure 5. Bitcoin daily candlestick chart with detailed EWP count.

Based on this level of detail, the ideal downside target for W-v of -5 of -A is between $9566-11315. Hence, I am looking for a low at around $10+/-1K. That said, BTC must break above $18185 and then above $21475 to tell us the downside has already been completed in a rather unorthodox fashion. For now, I find that less likely. Last but not least, after wave four comes wave five. Thus, once W-C4 ends, BTC will enter W-C5 targeting $150-1,000K.

Ethereum Dropped More Than Expected: What Does That Mean Going Forward?

The Correction Was Unfortunately Not Complete

The Elliott Wave Principle (EWP) count for Ethereum (ETH) was humming along very nicely as ETH bottomed and topped over the last two months where I thought it would: $1200 on October 18 vs. $1150-1220 expected September 19, followed by a five-wave rally into last week’s high, which I then anticpated to be retraced to $1380-1490, but warned that

I see no reason to change my Bullish perspective, only if ETH drops back below $1200 with a severe warning to the Bulls at $1320.” See here.

With last week’s FTX/Alameda debacle, the expected drop came, but it was also more profound than expected, and ETH broke below the critical Bullish warning levels. As such, the EWP count required a rewrite. The three-waves-down-five-waves-up sequence since the August high was not a W-i/a, -ii/b, -1/a setup, but most likely a complex W-X-pattern with the cryptocurrency now in wave-Y. See Figure 1 below.

Figure 1. Ethereum daily chart with detailed EWP count and technical indicators.

The Bullish Resolution is Still Possible, but $1000 Needs to Hold

The W-X-Y pattern is one of the most complex structures one can encounter, and it means ETH, thanks to the FTX/Alameda black swan event, is still in red W-ii/b. Thus, continuing counting/interpreting the June-August rally as a leading diagonal (red) W-i/a, it is not uncommon for the following W-ii/b to retrace back to the start of the diagonal (in this case, the green W-2 low at ~$1000 made early July: see Figure 1 above).

Although the Y-wave does not have to be comprised of the five orange waves, as shown in Figure 1, it would allow for a picture-perfect retest of the $1000+/-50 level. If ETH continues to rally from last week’s low and breaks back above $1550, with a first warning for the Bears above $1375, then odds start to increase W-ii/b has completed and the countdown for the rally to $3500+ restarted. A break below the $1000+/-50 zone will put further pressure on the Bulls and opens the door to as low as $750-350.

More Left for Ethereum’s rally?

The Correction Was Completed

In my last update, see here, I continued my Bullish stance on Ethereum (ETH) and showed by using the Elliott Wave Principle (EWP) that

the anticipated rally to around $3500 should start from $1150-1220, but a direct move above $1555 strongly suggests this rally is already underway. It is, for now, still a matter of “pay me now” vs. “pay me a little bit later.

The EWP, once again, did not disappoint, and ETH “paid me later” as it reached as low as $1200 on October 13, and has rallied strongly since. See figure 1 below. From that low, ETH has done five none overlapping (grey) waves higher to complete green W-1/a arrows. I have kept my premium crypto trading members continuously abreast of this impulse path.

Figure 1. Ethereum daily chart with detailed EWP count and technical indicators.

Ethereum Reached $1200+/-100 and Rallied as Expected. What’s Next?

Isn’t it amazing that already mid-September, the EWP allowed us to look for a preferred “(grey) W-iv top around $1460+/-30, and (grey) W-v should ideally be at about $1150-1225. From there, W-iii/c to ideally $3500 should start.”

My analysis, and as a consequence my premium members, did not miss much: W-iv topped at $1384 on October 6, and W-v bottomed at $1200 on October 13. Now (red) W-iii/c to ~$3500 is underway as ETH already breached “above that $1555 level” and topped out at $1671 last Friday -a 39% rally!- in a five waves pattern.

The larger W-iii/c will consist of at least three smaller waves: green W-1/a, 2/b, and 3/c (preferably five). Thus green W-2/b is now underway and should ideally bottom in the green target zone: $1380-1490. Green W-3/c should then take hold and rally to ideally $2150-2250. Then the market can decide if it wants to complete a W-4, 5 (my preferred POV) $3000+/-500.

In conclusion, my POV in September was proven right. ETH followed the preferred path almost to the T and has rallied strongly from the ideal target zone of $1150-1225 I had given. Thus, I see no reason to change my Bullish perspective, only if ETH drops back below $1200 with a severe warning to the Bulls at $1320.

S&P500’s Fibonacci Perfection, But Decision Time

The Impulse Path to The Downside Is Still Preferred

Since mid-September, see here; I have been tracking a possible impulse move down for the S&P500 (SPX) from the mid-August high (i.e., five waves lower as per the Elliott Wave Principle (EWP) ). Last week, see here, I applied the ideal Fibonacci-based impulse pattern to the downside and found

if the index wants to continue to follow the ideal impulse path, it should move lower to SPX3410-3515, bounce back to the ideal red W-iv target zone ($3680-3785), and then drop one last time to the perfect red W-v target zone (SPX3242-3345). By then, the SPX should be ready for a multi-month counter-trend rally.

Figure 1. S&P500 daily candlestick chart with detailed EWP count and technical indicators

The day after, the index dropped to SPX3491 and rallied today to as high as SPX3763. Thus, the ideal target zones for red W-iii/c and W-iv? have been reached. So far, so good. Note red W-ii/b was 232p and lasted for four days, whereas the rally from last Thursday’s low is now 272p and is also four days. Thus time-price symmetry has been achieved. But that doesn’t mean the red W-v? will, with all certainty, materialize. Allow me to explain.

The Next Target Is Ideally SPX3242-3345 As Long As SPX3887 Is Not Breached

Last week I already outlined, “However, if the index does not comply and rallies back above the red W-i/a low (SPX3887), with a serious warning for the Bears above last week’s high ($3807), then this impulse path is invalidated.” These two levels are shown with the upper horizontal, dotted, blue, and orange lines, respectively.

Thus, albeit red W-iv? can still try to move a little higher (SPX3784-3817), the index cannot move above $3887. If it does, then the multi-month rally depicted by the simplified straight blue arrow is in play. Conversely, a drop below last Friday’s low ($3579) will be a severe warning to the Bulls, and the red W-v will be confirmed on a fall below last Thursday’s $3491 low (lower horizontal, dotted, orange, and red lines; respectively). From there, we can expect the multi-month counter-trend rally (black dotted arrows).

Thus, the S&P500 is still following an ideal Fibonacci-based impulse to the downside rather well and is, therefore, still on target for the 3300s. Only a break back above the September 6 low ($3887) will throw a wrench in the Bear’s work and tell us a multi-month Bear market rally challenging the August highs is already underway.

Whatever way we slice and dice it, a sizeable counter-trend rally is brewing and getting closer by the day. It is simply a matter of “pay me now” or pay me later,” with the latter option still preferred, but thanks to the EWP, we know where that preference is wrong.

Is the S&P500 Still on Track for $3300?

The Impulse Path to the Downside is Still Unfolding

Since mid-September, see here, I am tracking a possible impulse move down for the S&P500 (SPX) from the mid-August high (i.e., five waves lower as per the Elliott Wave Principle (EWP) )

Back then, “the focus until proven otherwise” was for an ideal (red) W-iii/c low at SPX3400-3515, a W-iv back up to SPX3675-3785, and then a W-V back down to ideally SPX3230-3330 to black W-c?. See figure 1 below. The index bottomed on September 30 at SPX3584, rallied to SPX3723 last week, and it is now trading around SPX3580s. So where does that leave us? Allow me to explain below.

Figure 1. S&P500 daily candlestick chart with detailed EWP count and technical indicators

Figure 2 below shows the ideal Fibonacci-based path for an impulse (five-wave move) to the downside, which is the structure/path one applies initially to make one’s forecast: anticipate. The market will then decide how accurately it wants to fill that in for as long as “the third wave is not the shortest wave, and the fourth wave does not overlap with the first wave.”: monitor and adjust. W-3 of -iii ideally targets the 1.000 to 1.236x extension, W-4 of -iii the 0.764-0.618x Fibonacci-extension, etc. I have also drawn these target boxes in Figure 1, with the W-5 of W-iii ideal target zone in blue.

Figure 2. Ideal Fibonacci-based impulse pattern to the downside

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If we apply this structure to the current price action, see Figure 1, it follows that W-3 of -iii fell a little bit short but that W-b of -4 (of -iii) then reached the 100% extension. Moreover, the overnight Futures market went as low as 3560 on October 2nd. W-4 topped where it had to (the red 76.40% extension), and the logical conclusion is that W-5 of -iii is now underway with an ideal target zone of $3410-3513 (the red 138.20-161.80%) while knowing that the markets do not always have to follow this perfect path. Besides, the blue W-5 od -iii target zone sits at SPX3345-3412, thus there’s a nice Fibonacci confluence, which often works as a magnet for price.

The Next Target is Ideally SPX3410-3515

Thus, over the next few days, if the index wants to continue to follow the ideal impulse path, it should move lower to SPX3410-3515, bounce back to the ideal red W-iv target zone ($3680-3785), and then drop one last time to the perfect red W-v target zone (SPX3242-3345).

By then, the SPX should be ready for a multi-month counter-trend rally. However, if the index does not comply, and rallies back above the red W-i/a low (SPX3887), with a serious warning for the Bears above last week’s high ($3723), then this impulse path is invalidated. The multi-month counter-trend rally has then already started per the “alt: a, b, c” option.

Thus, the S&P500 is still following an ideal Fibonacci-based impulse to the downside rather well and is, therefore, still on target for the 3300s. Only a break back above the September 6 low ($3887) will throw a wrench in the Bear’s work and tell us a multi-month Bear market rally challenging the August highs is already underway. Whatever way we slice and dice it, a large counter-trend rally is brewing. Now it is simply a matter of “pay me now” or pay me later”, with the latter option preferred.

The S&P500 Is At a Crossroads. 3300 Is Still Possible, but the Bulls Have a Shot at 4000

The 3rd Wave is Complete: Decision Time

Three weeks ago, see here, I shared using the Elliott Wave Principle (EWP)A break below the early September low of SPX3886 opens the door for [an] impulse pattern with an ideal target zone of SPX3515-3400 for (red) W-iii/c, then a potential W-iv rally back to ideally SPX3675-3785 followed by the last drop to ideally SPX3230-3330 to complete W-v of W-c of W-A.

A week later, see here, I showed “the preferred view thus remains that of an impulse lower, but the Bears do not want to see the index move back above SPX3900 as that would start to suggest only three waves lower and a more complex pattern that can still allow for [as low as] SPX3680+/-20, where W-c = W-a … before the [rally to 4375-4545] kicks in.”

Last Friday, the index bottomed at SPX3584 (Futures reached as low as 3560 on Sunday evening) and has rallied 200p since. Thus, the index came within 2.5% of the ideal target zones set forth weeks ago for this important low, showing the remarkable accuracy of the EWP. It is among the many things my premium major market members benefit from. There are now three waves down from the mid-August high (see Figure 1 below), and it is now decision time. Allow me to explain.

Figure 1. S&P500 daily chart with detailed EWP count and several technical indicators

SPX3886 Remains the Key Bull/bear Line in the Sand

Figure 1 above shows the stock market has done three (red) waves lower from the mid-August high: W-i/a, ii/b, iii/c. Thus, now the index can decide if it wants to complete five (5) waves more down or only three (3) waves. The latter option was shared two weeks ago and is shown in Figure 2 below. The dividing line in the sand remains at the SPX3886 level.

Why? Because the 4th wave in an impulse cannot move into the price territory of the 1st wave. In this case, W-i is the September 6 low at SPX3886.75. Thus, if we see the index’s price move above that level at any moment as we advance without going below last Friday’s low, then the path to SPX4250-4700 opens.

Figure 2. S&P500 daily chart with detailed EWP count and several technical indicators

Please know I provide my perspective of the markets based upon the structure of the price action. Because financial markets are probabilistic, which the EWP recognizes, I must maintain a primary and alternative perspective on how the market will move. If the market breaks that primary pattern by moving above or below key price levels, in this case, SPX3886, it tells me that perspective is invalidated, and the alternative perspective will be adopted. Aka, “forewarned is forearmed.”

This saying is very appropriate. After all, this approach is no different from a general drawing up a primary battle plan and, at the same time, drawing up a contingency plan if the initial plan does not work out because battles can evolve unexpectedly. It is simply the way one must prepare for any battle as nothing is set in stone. There’s no difference in approaching the financial markets.

As such, I -and nobody for that matter- will never be able to tell you with 100% certainty how the market will move in the coming weeks, months, and years. Just like the general cannot foresee how the battle will go because there are, in both cases, almost an infinite number of variables at work. But with the EWP at hand, I can present you with enough information to know where the stock market will go under that primary perspective. And when it is invalidated, based on specific price levels, you can adjust your trading positions accordingly.

I hope you recognize the beauty of this approach, as well as the accuracy and reliability thereof. It allows me and you to view the market objectively using a mathematically based methodology. Moreover, the EWP combined with Fibonacci levels provides objective price targets and invalidation levels. Thus, when I am wrong in the minority of circumstances, one can adjust perspective and positions quickly rather than fighting the market, which is a fight you will never win.

S&P500: Still on Track for 3300, but Bears Be Careful

The Break Below SPX3886 Happened. Now What?

Last week, see here, I shared using the Elliott Wave Principle (EWP)A break below the early September low of SPX3886 opens the door for [an] impulse pattern with an ideal target zone of SPX3515-3400 for (red) W-iii/c, then a potential W-iv rally back to ideally SPX3675-3785 followed by the last drop to ideally SPX3230-3330 to complete W-v of W-c of W-A.” See Figure 1 below. Thus, the Bears are still fully in control until proven otherwise. What can that “otherwise” be?

Figure 1. S&P500 daily chart with detailed EWP count and several technical indicators

If There’s No Waterfall Decline, Something Else Is At Hand

Although the preferred view thus remains that of an impulse lower, the Bears do not want to see the index move back above SPX3900 as that would start to suggest only three waves lower. See Figure 2 below. In that case, the index is most likely working on a large 3-3-5 corrective pattern, black W-a, -b, and-c, called a flat (Blue W-B). Ultimately, the Bulls will have to push the index back above the red W-b high made in mid-September to confirm this path, but it pays to be aware of it.

Figure 2. S&P500 daily chart with detailed EWP count and several technical indicators

Even this more complex pattern can still allow for SPX3680+/-20, where W-c = w-a (red dotted arrow) before the black dotted arrow kicks in. Thus, short-term, pressure remains to the downside regardless of an impulse lower to ~SPX3300 (Figure 1) or if we’re dealing with this larger flat. However, the market can have a few tricks up its sleeve. Today I presented one of them.

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Is Ethereum’s Rally Around the Corner?

The Correction Is Close To Complete

Last week, see here, I showed by using my short-term Elliott Wave Principle (EWP) count (based on a daily-resolution chart) that

The Bulls are on full watch on a move below $1490 as that will negate a Bullish setup from the late August $1422 lows. Of course, below that low, we can set our sights on $1320-1150 for a rather typical/classic 61.80-76.40% retrace of (red) W-i/a to complete W-ii/b. And so far, the price action since the mid-August high is still corrective. That means the next rally, W-iii/c to ideally $3500, will get underway once the correction is over.

The Bears did not disappoint, and Ethereum (ETH) reached as low as $1282 today. See figure 1 below. The grey arrows are the path I shared last week with my premium crypto trading members to ensure they would stay as well-informed as possible of ETH’s price action. So far, ETH has followed this path to the T.

Figure 1. Ethereum daily chart with detailed EWP count and technical indicators.

Ethereum Reached $1200+/-100 and Could Rally Soon

Considering Saturday’s price action, there are technically enough waves to view the current leg lower from the (green) W-b high complete. However, and ideally, I would like to see a more pronounced (grey) W-iv and v. Thus, for as long as ETH’s price remains below the (grey) W-i low ($1555), this path should fill in. W-iv should top around $1460+/-30, and W-v should ideally be about $1150-1225. From there, W-iii/c to ideally $3500 should start.

But a rally directly above that $1555 level means (green) W-c of (red) W-ii/b most likely already completed. If that happens, I will set my eyes on the W-iii/c to ~$3500. Thus, either way, there’s nothing in the charts yet to tell me the rally to $3500 will not materialize. It is for now still a matter of “pay me now” vs. “pay me a little bit later.”

S&P500 Update: The Bears Are In Charge, Is 3300 Next?

Five Waves Lower After Three Waves Up

Since the mid-August high, the S&P500 has done five Elliott Wave Principle (EWP) waves lower. See Figure 1 below. This pattern tells me the current dominant path of the market is again lower. Moreover, the June-August rally was only three waves: a corrective, counter-trend rally. Thus, a break below SPX3886 (last week’s low and today’s low) tells me an impulse path is most likely developing, as shown.

Figure 1. S&P500 daily chart with detailed EWP count and several technical indicators

A Break Below SPX3886 Opens The Door For a Waterfall Decline

A break below the early September low of SPX3886 opens the door for the impulse pattern as shown with an ideal target zone of SPX3515-3400 for (red) W-iii/c, then a potential W-iv rally back to ideally SPX3675-3785 followed by the last drop to ideally SPX3230-3330 to complete W-v of W-c of W-A.

There’s a slight nuance to this overall bigger picture W-A, but the anticipated path and downside targets are the same. Hence, I will share it once we get there. Conversely, the index will have to break back above this week’s high of 4119 to tell us this bearish path is not unfolding and that 4500 is next. But, for now, I prefer to look lower.

The Bears’ Last Chance to Take Ethereum Down

The Correction Is Likely Not Complete

Two weeks ago, see here, I updated you on my short-term Elliott Wave Principle (EWP) count (based on a daily-resolution chart). Back then, I found

the first order for the Bulls is to close the price back above the 50-day simple moving average (blue line) as that SMA has been resistance over the last two days. Above it opens the door to $1700+.

The Bulls did all that this week but failed to hold the breakout today. As such, the rally from the late August low also looks corrective. See figure 1 below, which is the bearish option I have shared with my premium crypto trading members throughout to ensure they would stay as well-informed as possible.

Figure 1. Ethereum daily chart with detailed EWP count and technical indicators.

Ethereum Can Still Reach $1200+/-100 Before Rallying Again

As I wrote two weeks ago, “corrections comprise three waves (a-b-c), and since the August 14 high, that is what we got so far. Of course, corrections can become more complex, i.e., double or triple corrective patterns. But, for now, we cannot know if that will happen or not.

However, that more complex corrective pattern is most likely unfolding, and “the 2nd leg lower … ideally … to $1200+/-100” that I was initially looking for may finally come to fruition (nobody has all the correct answers all the time). Namely, the Bulls are on full watch on a move below $1490 as that will negate a Bullish setup from the late August $1422 lows.

Of course, below that low, we can set our sights on $1320-1150 for a rather typical/classic 61.80-76.40% retrace of (red) W-i/a to complete W-ii/b. And so far, the price action since the mid-August high is still corrective. That means the next rally, W-iii/c to ideally $3500, will get underway once the correction is over.

Is Bitcoin’s Correction Over?

The Correction From The August 15 Is Likely Over

Two-and-a-half weeks ago, see here, and before, I shared with you that per the Elliott Wave Principle (EWP), Bitcoin (BTC) had most likely completed a leading diagonal (LD) in August and had been correcting since then. I was looking for a “dead-cat-bounce,” a wave-b, targeting around $22465-23495 before the next leg is lower to $20000+/-1000 with an ideal target of $19386. Unfortunately, the bounce fell short at $21879, but as said back the

that bounce would be tricky as b-waves consist of three waves: less predictable, quick reversals—the very nature of a b-wave within a more significant correction.”

However, the downside target zone for this correction, the more critical price level to watch, was correct as the cryptocurrency bottomed on September 7 at $18559, which is well within the accepted 5% margin of error. Since that low, BTC has rallied to >$22K and is back above its (blue) 50-day simple moving average (SMA). See Figure 1 below.

Last week I told my premium crypto trading members that a break above $19535 would target $20,5K+ (see here). Thus, there are technically enough waves in place to consider the (green) wave-2/b complete and wave-3/c to ideally $37000+/-1000K underway.

Figure 1. Bitcoin daily chart with detailed EWP count and technical indicators.

All The Bulls Need To Do Is Push The Price Back Above The August High

Since BTC has essentially behaved as expected for many weeks, with several nuances and details that cannot be exactly forecasted (nobody has all the answers), I continue to maintain a Bullish stance until proven otherwise. At this stage, all the Bulls must do is push Bitcoin’s price back above the August high to tell us the correction is likely over (orange and blue arrows).

Conversely, BTC will have to drop below the recent $18.5K low, with a severe warning to the Bulls below $20.5K, to tell us it still wants to revisit $12K. But for now, given the strong reaction out of the ideal correction target zone, and the positive divergence on the technical indicators (green and red arrows), I find the bearish option less likely.

Ethereum’s Intermediate-Term Path Remains Bullish

The Weekly Chart Starts Still Looks Bullish

Over the past several weeks, I shared the short-term, detailed Elliott Wave Principle (EWP) count for Ethereum (ETH). But in between, I have also detailed an intermediate-term EWP count using a slightly different yet simple and elegant approach: see here. I count down, i.e., red weeks, as corrective (2nd and 4th waves) and up weeks as the Bullish part of an impulse (1st, 3rd, and 5th waves). Since no method is perfect, this works 9 out of 10, which is an excellent track record.

Back in August, I found using this method, “Thus, ETH has completed (red) intermediate waves i, ii, and iii so far. This week can be wave-iv; we need a wave-v to complete (black) major wave-1. That should ideally target the resistance zone at around $2300+/-100, earlier this year’s support zone. Completion of five waves up then tells us to anticipate a three-wave correction (black, major wave-2), followed by wave-3.” See figure 1 below.

Ethereum pulled back for two weeks and has now rallied for two weeks. Thus it appears (red) W-iv was completed at $1422 last week, and W-v is currently underway, and the weekly chart is therefore still Bullish.

Figure 1. Ethereum weekly chart with detailed EWP count and technical indicators.

Above $2030 Targets $2300

Since the bullish EWP sequence based on the weekly chart I introduced a month ago is still intact, Ethereum needs to move above the August high of $2030 to confirm W-v and target resistance at $2300+/-100. However, let’s not get ahead of ourselves and take it step-by-step as the Bulls still need to prove their case: completion of W-v.

Completion of five waves up means a three-wave correction (black, major wave-2) will follow. Conversely, a weekly close back below $1422 will be bearish and targets $1150+/-50. Thus, although the intermediate-term EWP count already looks Bullish, I would like the weekly chart to show that W-v.

Is Polygon -MATIC- Setting up For a Rally to $2s?

A New Bull Run Has Most Likely Started

For those who trade Polygon, aka MATIC, but are new to my work, please check my recent updates on Bitcoin (BTC) and Ethereum (ETH) –here and here, for example- to see the accuracy and reliability of my analyses. I primarily use the Elliott Wave Principle (EWP) in combination with technical analyses (TA) to determine the next likely moves and price targets for short- to the long-term.

Although this is my first public update on MATIC, I have been providing updates about it to my premium crypto members for a long time, and it is also featured in my algorithm-based crypto trading alerts service.

That said, Figure 1 below shows Polygon’s monthly candle stick chart, and the chart tells me that MATIC has most likely completed (Blue) Primary wave-IV. From the EWP, we know that wave-V must follow. As you can see, once MATIC broke below the critical $1.30 level, simple symmetry, Fibonacci-based retraces, and support levels told us to look for a low in the $0.40-0.60 region.

The cryptocurrency dropped in June to as low as $0.32 but closed that month at $0.48. Essentially exactly as expected two months prior. That is the power of the EWP and TA combined. A monthly close above the $1.3 level will confirm the presented EWP count. To suggest otherwise, MATIC will have to close below the July low of $0.44. With that in mind, it is prudent to understand the short-term price action.

Figure 1. Polygon monthly chart with detailed EWP count and technical indicators.

The June-August Rally Was an Impulse

Figure 2 below shows the shorter-term EWP count. The price action from the June low to the recent August high is best assessed as a five-wave impulse pattern. And from the EWP, we know that after five waves up (red wave-i comprises five smaller green waves), we must expect three waves lower (red wave-ii includes three smaller green waves so far) and another five waves up (red wave-iii).

Figure 2. Polygon daily chart with detailed EWP count and technical indicators.

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The red boxes show the typical wave-ii Fibonacci-based retrace target zone, and MATIC already did the bare minimum this week. As such, the wave-ii correction can be complete. To be more certain of that, we need to see the cryptocurrency break above the $1.00 level (blue arrow). Then it can target $2+ per the (red) waves-iii, iv, and v.

Alternatively, since corrections are often complex price patterns, Polygon could stall at around $0.92+/-0.02 (green wave-b) and fall below $0.75 targeting~$0.60+/-0.02 (green wave-c): red arrows. Thus, short term, there’s still a little uncertainty over the exact path, but even a drop will present a new setup from which MATIC can rally strongly to fulfill the Bullish EWP setup found in figure 1.

Is Ethereum Still on Track for a Bullish Move?

The Price Action Has So Far Unfolded as Anticipated

Over the past several weeks, I have kept you abreast on my short-term Elliott Wave Principle (EWP) count (based on a daily-resolution chart) for Ethereum (ETH). I was looking for

  • a top at $2100+/-100 (see here). We got $2028.
  • then a drop to $1400+/-100 (see here). We got $1422 so far.
  • and, last week, a bounce to $1750-1800, and then the 2nd leg lower to $1200+/-100 (see here). We got $1722 and then a drop to $1422 so far.

I review these forecasts not to pound myself on the chest, as I know I am wrong till proven right, but to verify that Ethereum’s price action is still following along an IMHO ultimately bullish path that can be rather accurately and reliably forecasted. So far, so good, and I see no reason to change my perspective unless ETH drops below $1000.

There are now enough moves/waves to suggest the correction from the August 14 high is complete. But the Bulls must push Ethereum’s price back above the $1722 bounce high. See Figure 1 below.

Figure 1. Ethereum daily chart with detailed EWP count and technical indicators.

The Correction From the August 14 High Could Be Complete

Namely, corrections comprise three waves (a-b-c), and since the August 14 high, that is what we got so far. Of course, corrections can become more complex, i.e., double or triple corrective patterns, but for now, we cannot know if that will happen or not. Thus, with the current data, I know the Bulls must push the price back above last week’s $1722 bounce high (green arrow).

That then opens the door to at least a retest of the August 14 high and most likely the red arrow/path to $3000+. Conversely, the Bears want to drop the price below yesterday’s low as that opens the door for a subdividing green wave-c down to as low as $1050-1000. That is still a good retrace of the leading diagonal (red) wave-i/a. But below $1000, odds increase significantly for a move to triple digits.

For now, the first order for the Bulls is to close the price back above the 50-day simple moving average (blue line) as that SMA has been resistance over the last two days. Above it opens the door to $1700+. Thus, the general path laid out a month ago is still unfolding as anticipated, and my premium crypto trading members benefit from that forecast tremendously. So, I see no reason to change my perspective until ETH breaks below $1000.

Bitcoin’s Correction Continues; How Low Can It Go?

The Correction From the August 15 High is Still Unfolding

Last week, see here, I shared with you that per the Elliott Wave Principle (EWP), Bitcoin (BTC) had most likely completed a leading diagonal (LD) and when that happens

price quickly drops out of them, moving back to the start of the pattern. In this case, the green target zone at $18.8-20.8K. Besides, the 76.40-61.80% retrace of wave-1/a is between $19.4-20.5K. Thus, there’s a good confluence between the two bolstering the case for a low around that area.”

Since corrections always comprise a combination of three waves (a-b-c) let’s see what has happened since last week. The cryptocurrency topped on August 15 at $25203 and now sits at $21500s. See Figure 1 below.

Figure 1. Bitcoin daily chart with detailed EWP count and technical indicators.

Counter Trend Rally, Aka Dead-Cat-Bounce, Underway

In my last update, I found, “I expect BTC to bottom soon. That is then (grey) wave-a of (green) wave-2/b. Wave-b should then commence, followed by a final wave-c to complete wave-2/b.” This insight was correct as BTC bottomed the next day at $20785. Wave-b is called a countertrend rally, or “dead-cat-bounce,” as the dominate (larger green wave-2/b) is down.

Ideally, this wave-b should target around $22465-23495, but that bounce will be tricky as b-waves consist of three waves. They are, as said, a countertrend, a correction of the correction, and thus three waves. Please know this environment: less predictable, quick reversals—the very nature of a b-wave within a more significant correction.

Regardless, when $22465-23495 target zone is reached, I still expect (grey) wave-c of (green) wave-2/b to commence. Thus, if BTC drops below the June 18 low, the two-month rally was a countertrend rally, and $12K is still possible. Conversely, if BTC rallies above the August 15 high more directly, green wave-3/c is already underway. However, both options are, IMHO, alternative low-odds scenarios, but it is always prudent to have a flexible and open mind.

Ethereum’s Bullish Elliot Wave Count Remains On Track

The Rally From the June 18 Low is Complete

Two weeks ago, see here, I updated you on my short-term Elliott Wave Principle (EWP) count (based on a daily-resolution chart) as I had been looking for Ethereum (ETH) to reach $2100+/-100 since late July (see here).

ETH topped on August 14 at $2028 and now sits at $1640. So far, so good. Albeit the devil is always in the details, and one cannot forecast each daily scribble correctly, the EWP is in the hands of a skilled analyst unmatched in finding where prices will top and bottom. My premium crypto trading members reap the benefits of that. Figure 1 below shows what I expect next.

Figure 1. Ethereum daily chart with detailed EWP count and technical indicators.

Correction Underway, Higher Prices Thereafter

As I wrote two weeks ago,”if ETH can stay above … $1561, it should be able to target the low 2000s. From those higher levels, I anticipate the cryptocurrency moving down … to ideally $1400+/-100.” The down is now underway, and the downside target zone has almost been reached. But it appears a bounce (green wave-b) and another leg lower (green wave-c) are needed to complete the anticipated (red) wave-ii/b.

I expect the bounce to reach resistance at around $1750-1800, and then the 2nd leg lower should ideally go to $1200+/-100. I know this target zone is slightly lower than initially anticipated, but back then, I did not even have any accurate information on where exactly ETH would top. Now that Ethereum topped, about $70+ lower than expected, the wave-ii/b target zone is also adjusted. Remember: all we can do is anticipate, monitor, and adapt.

The general path laid out a month ago is still unfolding as anticipated, so I see no reason to change my perspective until ETH breaks below the June lows. But at this stage, I don’t think that will happen. Thus, what we said two weeks ago remains valid, after the next significant pullback Ethereum could register the next leg up.

Bitcoin Failed to Reach $27.5+/1K. Is That Bearish?

The Rally From The June 18 Low Is Complete

Over the last few weeks, see, for example, here, I shared with you that per the Elliott Wave Principle (EWP), I was

tracking a leading diagonal (LD, green) wave-1/a pattern, which still requires a last (grey) smaller wave-v. For now, it appears wave-iv is still underway and should ideally find support in the $22,000-22,500 region. From there, wave-v should materialize, ideally targeting around $27,5K+/-1000.

The cryptocurrency bottomed on August 4 at $22418 and rallied to $25203 earlier this week. See Figure 1 below. Thus, while the wave-iv, v sequence I anticipated almost two weeks ago materialized, it did not reach as high as I initially expected ($27.5K+/-1K). Is that Bearish? Allow me to explain below.

Figure 1. Bitcoin daily chart with detailed EWP count and technical indicators.

Five Waves Appear Complete. The Anticipated Pullback Is Underway

In my last update, I found, “Thus, all it requires for the Bulls is to push Bitcoin (BTC) above the late July high of $24676 to complete (grey) wave-v of (green) wave-1/a. The ideal upside target remains $27.5K+/-1000 when BTC breaks above that level as that is now resistance (in May, that was a support zone).

If BTC completes these five waves, the following more significant pullback (green wave-2/b) will be an excellent buying opportunity. In that case, I anticipate, based on the currently available price data, a low of around $22K+/-1K.

  1. Although $27.5+/-1K was not reached, the cryptocurrency did move above the late July high of $24676 this week, and thus -IMHO- completed (grey) wave-v of (green) wave-1/a. Check!
  2. The anticipated wave-2/b pullback is underway. Check!
  3. $22+/-1K has been reached. Check!

But since BTC did not reach as high as $27.5+/-1K and only got to $25.2K, the wave-2/b target zone must be adjusted lower. See Figure 1 above. I now expect wave-2/b to bottom around $20+/-1K. Since the rally lasted two months, the current correction should also take time. Since corrections consist of at least three waves, in this case, grey a-b-c, I expect BTC to bottom soon. That is then (grey) wave-a of (green) wave-2/b. Wave-b should then commence, followed by a final wave-c to complete wave-2/b.

When diagonals are complete, the price quickly drops out of them, moving back to the start of the pattern. In this case, the green target zone at $18.8-20.8K. Besides, the 76.40-61.80% retrace of wave-1/a is between $19.4-20.5K. Thus, there’s a good confluence between the two bolstering the case for a low around that area.

Lastly, I am always wrong till proven right. Thus, if BTC drops below the June 18 low, the two-month rally was a counter-trend rally, and $12K is still possible. As such, the current pullback is a low-risk buying opportunity where one can use the June low as a stop loss level.

Ethereum’s Intermediate-Term Elliot Wave Count Turning Bullish?

The Weekly Chart Starts to Look Bullish, But…

Last week, see here, I shared with you that per the short-term, detailed Elliott Wave Principle (EWP) count, I expected another move higher for Ethereum (ETH) to ideally around $2100+/100. This move happened, and ETH reached as high as $2013. So far, so good. It is time to zoom out to review the bigger picture. See Figure 1 below.

Ethereum bottomed on June 18 at $880, only $11 away from the ideal c=a target of $869. Since that low, as I showed in my previous updates, ETH is most likely “impulsing” higher, which means the trend has changed from down to up. But I want to see this trend change, i.e. five waves higher, preferably on the weekly time frame. That will add weight to the evidence that a new Bullish cycle has started.

Figure 1. Ethereum weekly chart with detailed EWP count and technical indicators.

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Resistance is at Around $2300+/-100

Since the June 18 low, I can count down, i.e., red weeks, as corrective (2nd and 4th waves) just like I did for the rally leading up to the all-time high (ATH) in November last year. Since no method is perfect, this works 9 out of 10, which is an excellent track record.

Thus, ETH has completed (red) intermediate waves i, ii, and iii so far. This week can be wave-iv; we then need a wave-v to complete (black) major wave-1. That should ideally target the resistance zone at around $2300+/-100, which was earlier this year’s support zone. Completion of five waves up then tells us to anticipate a three-wave correction (black, major wave-2), followed by wave-3. See Figure 2 above.

Standard Fibonacci-based extensions and retraces suggest this 3rd wave should target ~$3700. However, cryptocurrencies tend to extend, and ~$6500 seems more likely. However, let’s not get ahead of ourselves and take it step-by-step as the Bulls still need to prove their case: completion of waves iii, iv, and v. Then a pullback for wave 2 followed by a breakout above wave 1. That will be the “go-go-go” signal.

Conversely, a weekly close back below the 200-week Simple Moving Average (now at $1253 and rising around $10/week) will be bearish. Thus, although the detailed EWP count already looks Bullish, I would like the weekly chart to align, and once again, the EWP provides precise if/then scenarios to know what will be next.

Ethereum’s Short-Term Elliot Wave Count Remains Bullish

The rally from the June 18 low looks even better

Last week, see here, I shared with you that per the Elliott Wave Principle (EWP), five waves appear to have been completed, and I expected another move higher after a pullback. However, the price action up to then was as such that I shared

Albeit not shown on the chart, the alternative EWP count at this stage is to see another rally to the $2100+/-100 target zone for another 5th wave, which would make the mid-June low the major (blue, Primary-IV) low.”

When applying the EWP correctly, i.e., objectively, one must always have a preferred and an alternate wave count because financial markets are probabilistic. Thus, the alternative EWP count provided the scenario/context to know what would happen on a breakout. This breakout has now happened; hence “another 5th wave to ideally $2100+/100” is now underway. See Figure 1 below.

Figure 1. Ethereum daily chart with detailed EWP count and technical indicators.

Upside surprises are Bullish

In Bull markets, the upside surprises (extensions of the up waves) and downside disappoints (2nd and 4th waves) as buyers step in. Thus, today’s breakout means last week’s alternate EWP count is now the preferred option. Figure 1 shows Ethereum (ETH) is trying to break back above the June-July, 2021 lows at $1700.

If it holds, the next level to look for is $2200+/-100 as that is the next resistance zone. This level fits well with the projected wave-5 target (green arrow). What I like about the current EWP count is that ETH’s low on June 18 now aligns with that of Bitcoin (see here and here).

Thus, if ETH can stay above last week’s low of $1561, it should be able to target the low 2000s. From those higher levels, I anticipate the cryptocurrency moving down along the red dotted arrows to ideally $1400+/-100. And from the EWP, we know that after five waves up and three waves down (red i/a, ii/b), expect another leg higher. So the next more significant pullback should be a great buying opportunity.

Bitcoin’s Short-Term Elliot Wave Count Remains Bullish

The rally from the June 18 low still looks good

Last week, see here, I shared with you that per the Elliott Wave Principle (EWP), I was

tracking a leading diagonal (LD, green) wave-1/a pattern, which still requires a last (grey) smaller wave-v. For now, it appears wave-iv is still underway and should ideally find support in the $22,000-22,500 region. From there, wave-v should materialize, ideally targeting around $27,5K+/-1000.

The cryptocurrency bottomed on August 4 at $22418 and has since made a series of higher highs and lows. Now it sits at $23900. See Figure 1 below.

Figure 1. Bitcoin daily chart with detailed EWP count and technical indicators.

Five waves are getting closer to completion

Thus, all it requires for the Bulls is to push Bitcoin (BTC) above the late July high of $24676 to complete (grey) wave-v of (green) wave-1/a. The ideal upside target remains $27.5K+/-1000 when BTC breaks above that level as that is now resistance (in May, that was a support zone).

If BTC completes these five waves, the following more significant pullback (green wave-2/b) will be an excellent buying opportunity. In that case, I anticipate, based on the currently available price data, a low of around $22K+/-1K. Why? Because from the EWP, we know that after 1, 2/a, b comes 3/c, respectively, targeting most likely $37K+/-1K.