Ryans' log

[Bitcoin_is_here_to_stay]

The RSI on 60 mins chart (BITSTAMP)  entered overbought zone couple hours before, suggesting we may have peaked in high $630s and are heading down short-term.

BTW, great thread, Ryan. I really appreciate you update so often and with such thoughtful posts. Keep up the good work!

[RyNinDaCleM]

The RSI on 60 mins chart (BITSTAMP)  entered overbought zone couple hours before, suggesting we may have peaked in high $630s and are heading down short-term.

BTW, great thread, Ryan. I really appreciate you update so often and with such thoughtful posts. Keep up the good work!

Thanks! I will keep on keepin' on for as long as it takes. 

The RSI can embed itself in overbought/oversold territory for long periods of time. Just because it gets there, doesn't mean imminent reversal. Just keep that in mind (in case you didn't already know that ).
Trading based on overbought conditions can have you sitting out for a while and missing potential gains, especially in bubble mode. Obviously we aren't there yet, but I just wanted to make that point.

[Bitcoin_is_here_to_stay]

The RSI on 60 mins chart (BITSTAMP)  entered overbought zone couple hours before, suggesting we may have peaked in high $630s and are heading down short-term.

BTW, great thread, Ryan. I really appreciate you update so often and with such thoughtful posts. Keep up the good work!

Thanks! I will keep on keepin' on for as long as it takes. 

The RSI can embed itself in overbought/oversold territory for long periods of time. Just because it gets there, doesn't mean imminent reversal. Just keep that in mind (in case you didn't already know that ).
Trading based on overbought conditions can have you sitting out for a while and missing potential gains, especially in bubble mode. Obviously we aren't there yet, but I just wanted to make that point.

Yeah, I know it can be overbought for a while, especially for btc. Anyway, it seemed for me to be a sign of weakness it went to overbought with such a small raise. But apparently I was wrong - upward movement became more energetic now.

I am not a day trader and do not worry, I do not plan to sell my modest btc position anytime soon. Currently looking to add more to my long position during nice correction. For a while it looked like we could see high $500s again (like $580-$590) but I am not sure anymore.

[RyNinDaCleM]

To avoid confusion, I had to relabel the Bullish count to allow for more degrees of waves. The count is Identical to the previous bull chart I posted yesterday, but with slightly different labeling.

Yesterday, I used Fibo to find the target of the 3 of (3) from the bullish count (post #60). After taking a closer look and projecting out the remainder of the current sub-wave, I feel that if we are in the bullish count, we will far overshoot that target. The top of 1 would be in the vicinity of 645-650 with a measured pullback to around $625 for the wave-2 low. This would put the new wave 3 of (3) of III at about the target mentioned yesterday and would still have another wave up to complete the (3). Confused yet?

Here are the charts to help explain better
Yesterday's Bullish chart
 

This is the new labeling of the same chart


Now that we're on the same page, I projected out the remainder of the wave-(i) to around 650, with a pullback to around $625 for the (ii)


This leads to a target for the (iii) around the same target I posted in yesterday's chart with yet another wave up to go. So I hope no ones head exploded with that.


For the bearish case, we could be nearing the bottom of the first wave down in the next series of impulses lower. If we top out before breaking $642.57, this starts to look more likely in the short term.


All invalidation's remain the same, so I didn't add them to the charts.

Edited for clarity

[Bitcoin_is_here_to_stay]

Triple top. Bearish short term seems more probable imho. Do you view it same way?

[RyNinDaCleM]

Triple top. Bearish short term seems more probable imho. Do you view it same way?

Not exactly the same, but a little, yes! While there seems to be no buying pressure (but it is Sunday), it looks more like a bull flag when viewed on the chart. It's all a matter of what is the stronger pattern.

Bull flag and invalidation of the short term Bull count


Triple tops are generally longer term patterns. The longer the pattern, the more reliable it is. It's being denied the rise 3 times with moderate declines between that produces the reversal. Now, if we were to finish the bull flag and fail to go anywhere then, I would definitely call that a double top because there were two different occasions where we failed to get past it separated by both time and a decent decline.

All of that said, I do feel slightly more bearish, personally. The indicators <weekly are in shambles. No one is buying, and the sentiment is far too high for a measly $20 rise this last few days. It seems like it's time for some squeezing.

[Bitcoin_is_here_to_stay]

Hi Ryan, you are probably right that I used term "triple top" incorrectly - I meant to imply very modest decline, about $10 to $619. It is actually still within frames of your bullish flag.

Neat observation on that flag . I am quite convince we are in long term bullish trend now and very short term it seems that we are going down a bit - like $10 - but I had problem figuring likely mid-term scenario. Your bullish flag seems to fit very well .

[NiceSoft12]

i dont see how elliot wave could possibly work on bitcoin or any other security.

[RyNinDaCleM]

i dont see how elliot wave could possibly work on bitcoin or any other security.

OK

Edit:
Follow along with the thread, then! Elliott Wave Theory is not by any means perfect, no TA is, but I have already shown to have some near bulls eye calls with my targets in this thread. I'm really not doing this as a predictive thread or an advisory thread, but more to show how to use EW/Fibo and that, if done properly, has merit as a way to increase probabilities and limit risk.
If you still don't want to take the time out of your busy day to read a couple of posts per day, then buh-bye and thanks for stopping in to voice your opinion. You can just keep blindly trading and hoping for the next bubble to save your capital from yourself.

If you'd like to learn more, then just ask! I will be happy to explain the psychology behind what makes EW work. Just don't dismiss something as impossible because you don't understand it.

Thanks!

[seleme]

Ryan, what's the best resource to read about EW?

[RyNinDaCleM]

Ryan, what's the best resource to read about EW?

This is a good starting point http://www.forexhit.com/learn-forex/elliott-wave-principle.html
This gets a little deeper http://www.tradingfives.com/articles/elliott-wave-guide.htm
This one will help with the most difficult part of EW... Corrections! http://www.fxtimes.com/education/elliott-wave-basics-variations-in-corrective-waves/

As with anything, it takes a lot of practice. I counted every chart I came across then counted it again. When you think you have it, you count it again. What I like to do, to confirm I have the best counts possible, is to count it out in a higher time frame for the basic structure, then go to a lower time frame to confirm that each of my waves has the proper fractals making it up and fractals of those. I also try to avoid the "modern" EW as much as possible. It is used because of leverage markets where you can see odd movements. But to me, it just feels like bending the rules to fit a chart that is difficult to count.

[seleme]

Thanks, I see some big traders using it regularly but my few attempts to figure it out failed miserably. Might have to take some real time to read about it.

[RyNinDaCleM]

Thanks, I see some big traders using it regularly but my few attempts to figure it out failed miserably. Might have to take some real time to read about it.

It is a very useful addition to the traders toolbox. Good luck and feel free to ask if you need help!

[Cryptopher]

Hey Ryan, once again, thanks for sharing your trading theory knowledge with the forum.

I was wondering, have you had success with trading? Whether it be on stocks or the crypto markets. I'm intrigued, I find that indicators are great for assisting trading, especially if you can realise that it isn't panning out quite as expected and exited if appropriate.

Trading ultimately boils down to having the balls to act upon the information or instinct that you have, right?

Many a time I've bottled out of investing/selling only to find that my initial gut feeling/information was correct.

[RyNinDaCleM]

Hey Ryan, once again, thanks for sharing your trading theory knowledge with the forum.

I was wondering, have you had success with trading? Whether it be on stocks or the crypto markets. I'm intrigued, I find that indicators are great for assisting trading, especially if you can realise that it isn't panning out quite as expected and exited if appropriate.

Trading ultimately boils down to having the balls to act upon the information or instinct that you have, right?

Many a time I've bottled out of investing/selling only to find that my initial gut feeling/information was correct.

Yes! I have been quite profitable. I have a set of indicators that is specifically for telling me which side to take profit in. When it's green, I take profit in BTC and red is Fiat. Then I use my standard set of indicators to trade by while sometimes going to my back-ups to help make the decision easier. EW is just one tool I use, but it's such a good probabilities checker that I use it extensively. I don't usually post my indicator set because if people begin to understand what I use, then it will start cutting in on my profits. Sorry, but that is where I draw the line. I too have some situations where my initial plan was the best one, but something in my charts said otherwise and I listened to it. It happens! We all have losers and we all make mistakes. That is part of trading. The most important part is to make the winners count.

You have to trust your ability in reading the indicators. But experience is what allows you to do so. It's kind of a catch 22, but you learn quick when money is on the line.

[RyNinDaCleM]

edit:
Explanation in next post

[RyNinDaCleM]

Sorry I was at Verizon and what do ya know? I had a terrible cell signal there  

Anyway, I threw this chart together from my phone, so the labels are off from the last chart I posted.
I was starting to think the full impulse was done due to divergences present in RSI and EWO, but now I see the EWO looks more like a 4th so I think this count is good. EWO returns to the zero line  for a 4th wave (marked in the chart). My targets have held very well so far, although building that chart from my phone got the time aspect all screwed up.

Here is the update of that same chart.


The target for the 5th remains the same ~605-610. After which, expect a bounce near $630.
Things are looking quite Bearish for the shorter term. The last couple of Bullish sub-waves have been invalidated and as the targets are hit, more will come. I'm not calling the bull dead, but signs are pointing toward the mid $500's to complete the larger ABC from the second chart in post #20. The Bullish count invalidation remains at $420.27, so well away from that.

This is the bigger picture of where we could ultimately be heading in the coming days/weeks.


The 3/4/5 are only preliminary targets and will likely need revision as it progresses.

This count also works for the extended Bear market, should we still be in it. That 5 would be the 1 of III of (C) shown here.


I will get a Bullish shorter term alternative up in a little bit.

Trade on, my friends!

[RyNinDaCleM]

This would be a bullish alternative to the count in my previous post. Invalidation of the bearish mid term is a break above $658.88



Then there is this.



This is the uber Bullish count. Why uber Bullish, you ask? Because, Every one of those 1-2's needs a corresponding 3-4 somewhere above the respective 1 (without overlapping) and finally a 5th to complete the impulse. A very extended 3rd impulse.

[RyNinDaCleM]

Targets lower all hit, and here is the bounce. I'll be watching this to see how it develops. Invalidation of the bearish mid term is at $658.88, and short term invalidation at $642.57.

[RyNinDaCleM]

There are two 2's labeled. This is because they are unknown, right now. Confirmation of the left 2 comes when we make new lower lows with a 5 wave move. Confirmation of the right 2 comes with a move up from the b in a 5 wave structure.

Note that B's can make new price extremes, however, since they are a 3 wave structure, it is a known b (and not a new impulse down) even with lower lows.



Since "a" in this chart seems to be a 3-waver, it's more likely corrective and not a new impulse up.