Bitcoin Evening Update 02/05/2018 Bear Trap?

The current price of Bitcoin is $6,532 on Coinbase. Today's high was $7097 with a low of $6483. Clearly the chartists were wrong with their target of $7500 as the bottom, as we saw the slight rebound after wicking down to the 200 Day SMA peter out. We've now seen a further 15% decrease from yesterday's low to today's low. Although some are saying that selling pressure is decreasing, an objective look at the charts is necessary for proper price prediction.

We'll take a look at the charts using the TD Sequential Indicator. The first circle indicates the first buy signal that you would have received, looking at the 4 Hour chart per yesterday. Early this morning you would have received your exit signal, when the red 2 began trading below the red 1. This would have been a break even trade. We have now received another TD Buy Count Set-Up with a Red 9, indicated by the third circle. Those who enter long on this position have the potential to get rekt or to propser, we will see tomorrow. We see RSI confirming the buy signal.

Back to the big picture. I have moved the projection for Wave 5's ending. This can of course end anywhere, but if it's going to go further past the 1.272 of Wave 3, then we have a few likely landing zones. The first one is relatively near at about $6009, this would be the likely 1.618 Fib Extension of Sub-Wave A of the Fifth Wave. For those who need clarification, Elliot Waves comprise many different counts and forms. We're seeing a five wave triangle elliott wave formation right now, with each wave being composed of a set of subwaves. The impulse waves (or waves to the upside) are composed of five waves, while corrective waves (waves to the downside) are typically composed of three. In this chart I've plotted the three sub-waves of Wave 5, which is the last wave of a five way corrective cycle. By measuring the length of Subwave A, we can guess a likely length of Subwave C, which should be the last subwave of the last wave of the corrective cycle. A recovery should come after. So the 1.618 Fib Extension of Subwave A would bring us to $6000. However, if we're measuring not from the sub-waves but from the main waves (meaning we'd have a very extended Subwave C) then the next Fib Extension for Wave 3 would be the 1.618 at $4700. I do not expect this steep of a decline, just telling what the chart shows.

I believe what we're seeing could be a potential bear trap, and the if it is then those who go short based on this breech of the triangle formation will get liquidated when price rebounds back into the triangle, which would be a very bullish sign. If we move back into the triangle after a "false" breakout that would indicate a very bullish confirmation of the validity of the wave structure and the triangle pattern. We will check back in tomorrow and see who got liquidated, the longs or shorts.

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