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The Scent of The Bottom @ Crappy Trader Notes #9

Some analysts say that BTCUSD price action is totally random or manipulated. They’re getting tired and bored by 7 weeks long choppy action. But if you look closely enough one can see what is the most probable price structure of the incoming bottom. This is what we share in today’s issue so you can benefit from this knowledge.

Let’s say it again — bottom is near but the correction has an ace up it’s sleeve

Let’s start by reminding that our current working hypothesis, explained in previous issues of Crappy Trader Notes, is that we are experiencing a wave 4 correction in the wave C correction of one degree larger.

Here is a visual remainder taken from the previous article

It means that we are almost at the tipping point of the correction that has started nearly year ago in April 2021. But there is still a place for a corrective wave 5. It means that there should be more down moves in the near future also. We still need to go lower to find a real bottom.

To this day we were not sure what the structure of the current wave 4 correction would look like. Frankly speaking, for previous couple of weeks, we were suspecting a so called flat correction, which is a common at the wave 4 position. However, volatile price action that took place in previous two weeks is giving us hints towards more interesting hypothesis.

A triangle of sorts hypothesis

So today, exclusively for our readers, we present more detailed prediction of what bottom scenario is most probable. And a triangle, displayed below, plays an important role in this prediction.

What if the price action is forming a triangle? So let’s assume for a moment, that we are having a triangle type of a correction indeed. It means that we should see more choppy and sideways price action that should culminate in an apex point somewhere near 40–41k BTC USD price level. As you can see we may be at the D wave of a five way triangle structure. So we should see little lower levels followed by a spike towards triangle apex with a high degree of probability.

When the triangle is completed and fully constructed we find a noticeable move down very probable. One may expect a target point at 25–28k BTCUSD level presented at chart below.

So it’s a more volatile version of the most probable extended flat scenario which we predicted in the previous article. In our opinion bottom price action will take place at 28–30k BTCUSD levels but some wicks may touch 25k BTCUSD levels.

Really? Aren’t you falling into a permabear fallacy?

Well, we might have. Trading is a science not a certainty. Although we might be wrong in predicting the bottom true look and feel, there are multiple indicators pointing towards these price levels. These including:

  • wave 5 fibonacci count — assuming 40–41k BTCUSD is the wave 4 end level
  • point and figure calculations — taking 35–45k BTCUSD range as a large redistribution area that is building a cause for a move down accordingly to Wyckoff’s theory
  • Jan 21 and Jun 21 price levels — as a massive demand area and an eventual double top neckline price level
  • specific techniques that are applied within triangle correction that allow to predict move breadth when exiting the triangle
  • technical indicators that are showing that there is a space for a further down move still

For sure this will be a volatile and risky period as approaching bottom and reversal is a bumpy road.

So as always, stay safe & liquid. Trade carefully and properly manage your risks.

Great buy opportunities are just around the corner so staying on the sidelines and waiting for a perfect time to buy is not such a stupid idea.

More reading

If you want to see how did i come to current predictions i recommend reading previous chapters of the blog. Therefore you can follow my reasoning and see how genuine my remarks are.

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Yenten Observer

Cryptocurrency freak. Freedom, ecology and free market above all.