BTC broke out, now keep your eyes on the size! $9500 /$14000

2020年1月14日

Leading up to now:
For this we need to zoom out some, we are looking at just over the last two years of price action with 1d candles. In the first wave, we tested the long term ascending trendline after coming down hard from our 21k high to just over 3k. After the first wave crashed, we stuck around the bottom of the long-term ascending trendline for 4/5 months from December 2018 to April 2019 before we finally took off on the second wave which ran to 14K before starting this most recent 6/7 month descending channel of sadness. The descending channel drove the price into the 5 year ascending trendline twice where the second test of support launched BTC on the run we are currently enjoying. It is possible that we could see a similar delay between waves but right now the charts seem to be indicating no such thing.

It’s the Size of the wave that counts:
Lets talk about the importance of the size of the waves. First wave, 20k, second wave 14K, that’s a 6k reduction. We have some long-term support/resistance coming up at $9500 currently ($4500 reduction from last high). Maybe we only see this wave go to $9500, maybe the waves continue to diminish until BTC is too weak to maintain longterm support or maybe just a large Elliot wave needs to complete before the next big jump. There should be some relief one might have after we break current $9500 resistance but the real sigh of relief will be when wave 3 surpasses the height of wave2 confirming a strengthening trend rather than diminishing. Ultimately if we see BTC top the 20k high of before it would be extremely bullish for the long term charts and making 6 figure BTC extremely likely in the future.

Whats next? (higher probability)
-We run to $9500 over the next 24-48 hours then pull back off of $9500 and form a nice ascending wedge (green) that runs until late May making a breakout up or down, likely around Mid-April. There is a good chance breaking up out of this wedge could land us into another wedge (Red) between 14K and the 5 year trendline with a break out somewhere around September 2020.

-We pull back and ride the top of the previous descending channel down to around $7600 and slowly rise hanging out around the 5 year trendline for a few months like we did after wave2

-We could break right through $9500 and treat it much like we treated $7800, we could run all the way up to 14K in short order. There could be a lot of pressure to stay under 14K especially after such an exhaustive run. This may cause the price action to form a channel between 9600ish and 14K before forming an ascending wedge(red) with the 14K resistance (Wave2 high) and the 5 year trendline. a break upwards from here will be to test the previous ATH, a break down below the 5year trend still would be a big sell signal.

-We blow through everything, $9800, 14K, 21k and go on a run making all new highs, never looking back. Also a good chance that 21k may cause us heartache trying to jump it, will look at that more as we near it.

Realistically this is a little soon to say where this might go after this breakout, it just got started so I suspect you guys will see a revision after we see where this run starts to consolidate and/or correct.

For myself and my risk pallet, I see every touch of the 5 year ascending trendline as a great opportunity to add to long positions and/or pickup long-leveraged positions. Also If we break down (and hold) the 5 year trendline, I would likely pull most all of my assets out of the market and sit on the sidelines for a while.

These are my observations as an investor and trader, it is not investment advice, always DYOR.