BTC - Cycle Correlation between the June and Current Charts!
מעודכן
I see many post in the comments about a correction not happening till after the release of bitcoin gold. Ok I'm not a big on News driving markets more that markets move in cycles. So this morning I started seeing if there was a correlation between the June correction and the current chart which as we posted recently have similar patterns. Let's see if there is a correlation with time!
The first cycle I added to the June chart was from the start of the final blowoff to the first dip. Nice 2 day correlation and it is not surprising the second dip happened 2 days after, so lock it in. Then I looked at the small correction just before the final leg up. A little more than a day, so let's see how that works. WOW, both cycles correlate to critical points on the chart. The second selloff on the 8th of June but also the beginning of the Broader selloff that started on the 11th.
So let's see how those same cycles work on the current chart. If I just use the same time cycles as June there is absolutely no correlation it's a mess. But we do not care about days we care about points. So I adjusted it from the start of the last leg up and the first dip. Bam 3 day cycle. Holy Moses it dipped on the on the 6th day (next cycle) ok let me see if the the dip works as well. Well it doesn't amaze me. By using the final mini cycle from the 9th to the 11th I get the exact same correlation as the June chart!
Now let's take a look at the second correlation on the 27th of October where we would expect the start of to be in a selloff. Less than 2 days after the release of gold!
A further look into how we can expect the movement to go is that we pierced with a wick the $3000 psychological barrier. Well as I'm writing that we just did that but that is not the critical level. From the bottom of the correction to the final top the move was 19% of the overall price after the first correction. adding 19% to the bottom of this current price puts us right around $6104.
In a previous article we have a red line drawn at $6245 which would verify the correction happened at the bull is to resume (keep in mind a large correction can happen but is unlikely). Now until this happens we just do not jump on the rocket bandwagon. We must keep in the back of our mind a correction can still happen.
It is also important to look at risk rewards. Buying at $5700 for a $500 movement when a potential $1700 correction can happen according to EW is not a good risk reward. Do it enough you will get burned so unless you bought the $4750 breakout I would not be buying here. I would most likely close as the $6000 target was hit from our article "another leg up".
So I have changed to neutral as I expect us to trade sideways with movement between $5500 and $6100. But the cycles (as rough as my chart is) could indicate an upcoming correction, and I am not a cycle guy (market timer) so I will just stay neutral until we get past this date.
Many other setups have better risk to rewards and I have posted a few this morning!
The first cycle I added to the June chart was from the start of the final blowoff to the first dip. Nice 2 day correlation and it is not surprising the second dip happened 2 days after, so lock it in. Then I looked at the small correction just before the final leg up. A little more than a day, so let's see how that works. WOW, both cycles correlate to critical points on the chart. The second selloff on the 8th of June but also the beginning of the Broader selloff that started on the 11th.
So let's see how those same cycles work on the current chart. If I just use the same time cycles as June there is absolutely no correlation it's a mess. But we do not care about days we care about points. So I adjusted it from the start of the last leg up and the first dip. Bam 3 day cycle. Holy Moses it dipped on the on the 6th day (next cycle) ok let me see if the the dip works as well. Well it doesn't amaze me. By using the final mini cycle from the 9th to the 11th I get the exact same correlation as the June chart!
Now let's take a look at the second correlation on the 27th of October where we would expect the start of to be in a selloff. Less than 2 days after the release of gold!
A further look into how we can expect the movement to go is that we pierced with a wick the $3000 psychological barrier. Well as I'm writing that we just did that but that is not the critical level. From the bottom of the correction to the final top the move was 19% of the overall price after the first correction. adding 19% to the bottom of this current price puts us right around $6104.
In a previous article we have a red line drawn at $6245 which would verify the correction happened at the bull is to resume (keep in mind a large correction can happen but is unlikely). Now until this happens we just do not jump on the rocket bandwagon. We must keep in the back of our mind a correction can still happen.
It is also important to look at risk rewards. Buying at $5700 for a $500 movement when a potential $1700 correction can happen according to EW is not a good risk reward. Do it enough you will get burned so unless you bought the $4750 breakout I would not be buying here. I would most likely close as the $6000 target was hit from our article "another leg up".
So I have changed to neutral as I expect us to trade sideways with movement between $5500 and $6100. But the cycles (as rough as my chart is) could indicate an upcoming correction, and I am not a cycle guy (market timer) so I will just stay neutral until we get past this date.
Many other setups have better risk to rewards and I have posted a few this morning!
הערה
One other note it was exactly 5 large cycles in both charts from the start of the run to the final correction and 5 smaller cycles from the major correction. Patterns in the market are sometimes scary!הערה
My buddy MarcPmarkets wrote a great article on BTC today. It's worth it's weight in bitcoin gold ;) I couldn't agree more with what he says.
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