We've solidly settled the recent 10K bottom, and finally popped above the major 11,100 S/R line (from the big ATH selloff bottom). Next challenge is breaching the yellow downtrend shoulder line at 12K, which also happens to be where the pitchfork median is waiting. Note the red circle both here and back on Jan 2nd when we rallied from the same crossing point. **If that breach fails** this entire forecast is invalid, and we're going to slump hard...
Plenty of bulls have been hoping for a return to the pitchfork channel top, and I've been skeptical given all the bearishness lately. Bulls have had no juice on bounces, while bears have succeeded in dumping hard and fast every time. But there's something happening in a few hours which might just provide the psychological rocket fuel for the bulls: Weiss Ratings is about to release the first grades by a ratings agency for cryptocurrency. weissratings.com/ Now I have exactly no clue how significant this is really, I'm not savvy about ratings agencies whatsoever. No clue how the wider market will view this. But what I do know is that crypto bulls are OBSESSED with news that "legitimizes" crypto in the financial industry. Real-world use cases, ETFs, Futures, positive statements by governments, etc. Just look at the recent mania with XRP -- the idea (however oversimplified) that "banks are using ripple!!" was enough to fuel a huge pump. Bulls are desperate for good news. This might just be enough ;)
So while my other recent charts have been already been sketching a path to a new bulltrap just under 14K, I've honestly been skeptical of my own forecast. But I decided to take a clean look at the fibs and see what was plausible from a TA perspective (before I even heard about the Weiss stuff in the chat).
Quite simply, a 15K max target would put us right at the 0.705 OTE retrace of the entire selloff since the 17.2K bulltrap. And it's also nearly identical to where the 1.618 fib extension sits (of the rebound from 9-13K). So you've got two major movements with overlapping retrace (and extension) fibs. The rebound from 9K even hit its own 0.705 OTE buy zone perfectly and is starting the rally from there. Yes, this formation would become a big bearish Gartley all over again, so I'd expect a similar fall from the new 15K bulltrap back down to the intersection of the pitchfork median, 50% fib, and the new brown rising triangle bottom.
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Of course, their website crashes minutes before the release ;) If they even have an IT department, they're all getting flogged right about now...
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Report is out, would seem EOS, ETH, NEO ADA, and STEEM are the favorites in the "B" grade. Bitcoin at least made a respectable "C+" for hodling ;)
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Sooooo, STEEM had a nice little bump, ETH too -- but so far bitcoin doesn't seem to be caring at all about Weiss grading. Guess if we go up from here it will just have to be TA ;)
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Crawling up slowly from the wiiiide-bottomed reversal ;) Still higher highs, higher lows. Each leg retraces hard, but solidly hits the fibs.
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If I was a weatherman, I'd be forecasting lots of sun with low heavy clouds, clearing up in a few days ;)
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NOTE: there's a perfectly good chance we won't reach escape velocity right here, and might need a recharge on the triangle bottom before breaching the top. Doesn't mean the rally is over, just a quick touch in the 10,500 zone again. Don't be spooked unless the whole triangle collapses :P and if you missed the cheap coins, here's your second chance ;) If you already bought at the local 10K bottom, then just hodl and relax!
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First attack of the Red Zone (downtrend shoulder line and fork median) where the rally could break through. Would be the most bullish scenario, of course. We could fail here on the firs try, drop to the triangle bottom and try again too, but would probably result in a lower peak target later.
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First attempt denied, now we have some rebound options for exiting the triangle -- the major 11,100 resistance has now become support, we could have a short pullback and punch thru on the second attempt, or we could drop all the way down to the triangle bottom (10,500 zone) before picking up enough steam. Bull scenario is still viable as long as we don't fall out the triangle bottom. We're basically just killing time filling out the triangle tip waiting for a strong impulse move
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Yes, all this tepid ranging with no impulse, is most likely due to the market sitting on its hands waiting for the CME futures contract to expire tomorrow (Jan 26th)
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I'm not an EW guy, don't expect me to debate the finer points of wave identification, but this is how a 5-wave impulse to 15K could play out here. Also notice I should have drawn the red circles more as ovals, but just like last time, there was a first attempt to breach the downtrend and then we hugged it until popping a little later
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Expect stop-hunting and whiplash. Look how much chop we had in the previous red circle -- and yet we rallied hard afterwards. Ignore the calls for doom, that only applies if we actually busted the triangle bottom :P
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Sooooo, just hours before CME futures expired, and *right* at the moment we were breaching the triangle top - rumors started swirling about a Japanese exchange getting hacked to the tune of 700 million dollars o_O It wasn't even about bitcoin, but a bunch of NEM that got sucked out of hot wallets, because the idiots weren't keeping client funds safely in cold wallets :(
Of course the similarities to Mt. Gox are obvious, so the market freaked out and dumped vertically -- but stopped right at the triangle bottom, so one could say "we were going there already". Sure, but if you want to ensure a swift panic crossing of the triangle, you couldn't pick a better motivator than carefully-timed asian heist FUD :P
Anyways, folks got another chance to catch 10,300 coins, and we're rising up to the top again for another attempt at the trend line. Notice the similar contention on Jan 1-2 where there were multiple attempts to breach, and even a sizable pullback, before finally crossing and taking off. We could be doing the same in this red circle now. As long as this triangle is still in play, the bull forecast is viable (though if we take too long 15K won't be within reach on the channel top)
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It took three kisses and a lot of hugging, but the bulls have been persistent ;) And even if the Weiss ratings fell mostly flat, the market has also been churning with other news, including futures contracts closing and new ones opening. It would seem the futures are far more bullish this time, with long positions more than double shorts :)
We've breached the long downtrend shoulder line since 17K, and now are just paused on the pitchfork median. Expect much more buying volume soon...
I find way more interesting traders who have doubts vs. trader with "absolute confidence".
I like your analysis since you leave space for different scenarios, doubts, contingency plans.
“The problem with the world is that the intelligent people are full of doubts, while the stupid ones are full of confidence.”
― Charles Bukowski
ronfkingswanson
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@Tradetech, I like to know in advance what it would look like *if I was wrong* (because I often am) - and i keep updating charts for contrary scenarios precisely so I can identify it when it happens. Cheers ;)
You are the best, really appreciate all your updates.
osternikov.t
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+1
devilninja777
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Weiss report is absolute garbage... it's sad that this will have influence. Nothing about Development, Dev count, Wallet installs, Search volume, Exchange presence, Uptime, Liquidity, History, Battle Tested Resilience... I can go on an on. Every blockchain has a scaling problem, but they only knock Bitcoin for scaling when it is already working on several solutions. Fuck these guys.... Bitcoin never gets it easy.... meanwhile ETH always gets put on a pedestal... no attacks, no FUD, no worries.... if these alts got half of the shit Bitcoin got they wouldnt survive
AussieCrypto1
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@devilninja777, I agree. These idiots complaining about Bitcoin are no better than an idiot complaining about Microsoft because he's computers slow when MS have had an update out for months to fix it but the idiot won't update their computer. 100% Segwit adoption would completely fix the mempool. In fact we had a spike of 7% adoption (total 19% from 12%) a couple days ago and the mempool has dropped significantly. We were 150sats/byte a few days ago, last time I looked it was 25sats/byte which isn't that expensive. With lightning already on Main net and plenty of nodes being tested, I can see fees and tx speed an issue of the past if companies like Coinbase actually batch transactions and implement Segwit. Even that ponzi scheme; Bitconnect had better developers than Coinbase. I read that they batched transactions and issued there customers Bcash on the fork. How is coinbase such a massively used company when they have worse devs than a ponzi scheme? LOL I am losing faith in humanity.
4budab1
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Damn, im stoned
WSBChairman
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ronfkingswanson
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@HJQI, this was basically the reasoning for my 14K high target on my "fractal road" chart. We'll see how much juice the bulls have in them once we exit the triangle. 14K would also make for a nice bulltrap precisely because they'd be hoping to unload bags at 15K, and get left holding longs... too long
I like your analysis since you leave space for different scenarios, doubts, contingency plans.
“The problem with the world is that the intelligent people are full of doubts, while the stupid ones are full of confidence.”
― Charles Bukowski