2019 Cryptocurrency (Elliott Wave): Inflection Pointhttps://www.reddit.com/r/BitcoinMarkets/comments/cipwdi/2019_cryptocurrency_elliott_wave_inflection_point/From the 2018 bear market low set on 15-DEC-2018, the Bitcoin bull market has gained 340% into the high of 26-JUN-2019. Since then, the largest pullback of the 2019 bull market has been underway, thus far a 35% decline heading into AUG-2019.
From an Elliott Wave perspective, two scenarios can now be considered at this inflection point: a continuing
Bull Scenario (Preferred) or a
Bear Scenario (Alternative).
In either scenario, the following Elliott Wave model proposes a five wave structure, consisting of: three advancing bull market waves, interwoven with two declining bear market waves. Overlaying this model onto Bitcoin suggests:
Wave 1: the first bull market wave 2010-2013 (1219 days), followed by;
Wave 2: the first bear market wave 2013-2015 (426 days), followed by;
Wave 3: the second bull market wave 2015-2018 (1065 days), followed by;
Wave 4: the second bear market wave 2018-2019 (363 days), followed by;
Wave 5: the third and final bull market wave 2019-?
The five aforementioned have been considered as PRIMARY degree waves —such waves elapse the course of a few months to a couple of years. Each PRIMARY degree wave is constituted of five INTERMEDIATE degree waves; and in turn, so forth into smaller degree fractals.
The continuing bull market scenario suggests the first INTERMEDIATE leg of PRIMARY[5] has completed, and four more INTERMEDIATE degree waves are yet to unfold; either meeting or exceeding the all-time highs of PRIMARY[3] wave.
The alternative bear market scenario suggests PRIMARY[5] has completed in entirety, and failed to meet or exceed the all-time highs of PRIMARY[3] wave. In Elliott Wave parlance, this is known as a ‘failed-fifth’ or a ‘truncated’ wave.
Bull Scenario (Preferred)
The preferred scenario suggests a continuing bull market is underway. PRIMARY[5] wave started from the 06-FEB-2019 low, and has completed its first leg labelled as INTERMEDIATE(1) wave at the 26-JUN-2019 high.
INTERMEDIATE(2) wave pullback is currently underway and expected to complete at the following Fibonacci retracement levels, using BITSTAMP prices:
@8500: 50.0% Fibonacci retracement from 15-DEC-2018 to 26-JUN-2019 (min expected zone)
@7230: 61.8% Fibonacci retracement from 15-DEC-2018 to 26-JUN-2019 (avg expected zone)
@5425: 78.6% Fibonacci retracement from 15-DEC-2018 to 26-JUN-2019 (max expected zone)
@4350: 88.6% Fibonacci retracement from 15-DEC-2018 to 26-JUN-2019 (WARNING)
Once INTERMEDIATE(2) pullback completes, INTERMEDIATE(3) wave is expected to resume the PRIMARY[5] bull market to meet and exceed the all-time highs of PRIMARY[3] wave.
Where the PRIMARY[5] bull market ends is open to interpretation and speculation. There are calls of $50,000 to $500,000 to $1,000,000 and even beyond…!
From an Elliott Wave perspective: A common wave relationship guides the price of the fifth wave to be equal to; or extend a Fibonacci 1.618 times; the length from the low of the first wave through to the high of third wave; projected from the low of the fourth wave. This provides a conservative target of the current bull market to conclude between $22,912 and $35,127, calculated using the BraveNewCoin (BLX) index:
@22912: PRIMARY[5] = (PRIMARY[1] + PRIMARY[3]) * 1
@35127: PRIMARY[5] = (PRIMARY[1] + PRIMARY[3]) * 1.618
As and when the waves develop and progress, or in the event of subdividing and extending waves, revised price targets shall be calculated with renewed projections.
If the current INTERMEDIATE(2) pullback retraces a Fibonacci 78.6% of the entire 15-DEC-2018 to 26-JUN-2019 uptrend, then the bull market has a 50/50 odds of resuming.
A retracement to the Fibonacci 88.6% level is the first warning signal to suggest the bull market may be over.
A decline to the 06-FEB-2019 low confirms the bull market is over.
Bear Scenario (Alternative)
The alternative bear market scenario suggests the 2019 bull market was a short-lived affair, and PRIMARY[5] terminated as a failed-fifth truncated wave.
In this scenario, a CYCLE[II] wave pullback is now underway and headed to break below the 2018 low.
The following technical analysis motivations, in order of significance, support the bear market scenario:
1. The cryptocurrency market breadth represented by the Altcoins have failed to materially participate in the 2019 bull market. The majority of Altcoins are currently approaching their respective 2018 lows.
2. The last two monthly candles of Bitcoin, i.e. JUN-2019 and JUL-2019, are equivalent in formation to DEC-2017 and JAN-2018. Both sets of candlesticks formed a bearish ‘Shooting-Star’ and ‘Tweezer-Top’ pattern. A ‘Shooting-Star’ candlestick in an uptrend exhibits a long upper wick signalling a reversal. Two consecutive ‘Shooting-Star’ candlesticks form a ‘Tweezer-Top’ pattern: where the close price of the first candlestick is equal to the opening price of the second. A monthly close above $10,760 is required to obviate the bearish scenario:
3. Perhaps superficial but worth consideration, is the current daily price action fractal which bears similarity to the 2017 top:
Inflection Point Summary—A decline to $5425 (BITSTAMP) puts the bull market at 50/50 odds of survival.
—A decline to $4350 (BITSTAMP) provides a warning signal to suggest the bull market may be over.
—A decline to the 06-FEB-2019 low confirms the bull is over.
—A monthly close above $10760 (BITSTAMP) provides a signal to suggest the bull market is resuming.
29-JUL-2019: Bitcoin CME Futures Settlement
30-JUL-2019: BoJ Monetary Policy Statement
31-JUL-2019: FOMC Interest Rate Decision
01-AUG-2019: BoE Interest Rate Decision
02-AUG-2019: Nonfarm Payrolls
Speculation is indicative of price/structure, not time.
