BITCOIN hit its FIB extension limit of $3931, however it continued past to finally form a new A-B boundary at $4480. After it forms a new high, the rule (taught to me by a trading yoda) is that 90% of the time it will come back to the 38.2% of the FIB retracement @$3467. At that point we did see a pull back, however it did not touch the 38.2% FIB level, and rebounded at $3628 to form a new high at the 1.18% of the FIB extension. There are 6 types of wave movements and one of those is if it doesn't touch the 38.2% it will go up and reverse between the 1.18 - 1.27% of the FIB extension which it did, to make a deeper retracement within the AB boundary.
On the 4th of September it broke the inner up trend line to take out a level of support at $4195 indicating a possible crown reversal. In order for this to be a crown reversal, it will then move up to the last level of resistance which was approx $4651(right side of crown), and is also the backside of the inner trend line at which point we begin to see it fall to the next level of support/outer trend line which is generally somewhere in the AB boundary. It has started this move down, with confirmation today on the daily chart being a bearish engulfing candle.
From here my expectations is that it will rebound from one of 2 possible levels of support. The first level is around $3530 and the next is at approx $3030 and from here it should rebound to continue to move up to its FIB extension of $5879.
Note: I have drawn in a counter trend line and unless it breaks this line it will continue to the the levels I have discussed above.
Brief explanation of my technical method:
I use a method of analysis using a combination of Fibonacci's, and support and resistance (taught to me by a FX trading guru), where I market out the lowest low to the next highest high (for an up trend), which then becomes the FIB range to work within (A - B) . In order for this FIB range (A - B) to be valid, we need to have the highs of two candles lower on either side of the highest high. Depending on where the market falls to within this (A - B) range determines the target on the next rally. More often than not the target is hit (D) to the "pip" at which stage a new FIB range is established.
On the 4th of September it broke the inner up trend line to take out a level of support at $4195 indicating a possible crown reversal. In order for this to be a crown reversal, it will then move up to the last level of resistance which was approx $4651(right side of crown), and is also the backside of the inner trend line at which point we begin to see it fall to the next level of support/outer trend line which is generally somewhere in the AB boundary. It has started this move down, with confirmation today on the daily chart being a bearish engulfing candle.
From here my expectations is that it will rebound from one of 2 possible levels of support. The first level is around $3530 and the next is at approx $3030 and from here it should rebound to continue to move up to its FIB extension of $5879.
Note: I have drawn in a counter trend line and unless it breaks this line it will continue to the the levels I have discussed above.
Brief explanation of my technical method:
I use a method of analysis using a combination of Fibonacci's, and support and resistance (taught to me by a FX trading guru), where I market out the lowest low to the next highest high (for an up trend), which then becomes the FIB range to work within (A - B) . In order for this FIB range (A - B) to be valid, we need to have the highs of two candles lower on either side of the highest high. Depending on where the market falls to within this (A - B) range determines the target on the next rally. More often than not the target is hit (D) to the "pip" at which stage a new FIB range is established.
