You feeling it yet? The FOMO. Yup, that is exactly what's been happening today across U.S. equities and cryptocurrency. Ignited by Alphabet, Inc.'s stronger than expected earnings report, the market gapped up above the bearish daily close yesterday. Today, I was originally going to review Shopify, Amazon and Virgin Galactic, but last minute I decided to review the cryptocurrency space as my Elliott wave count has now shifted a bit. Now let's get into it Bitcoin.
More than a GAP?
As I was writing this post Bitcoin had just filled the CME Gap at around $9090. This may be significant a significant top. Since the CME opened its Bitcoin futures, the Gaps have for the most part been filled up. Now that it is filled, what can we expect going forward from the King of Crypto!
On the chart above you can see that Bitcoin is knocking right into resistance, a level in which served as the rejection that led to the strong sell off in March. Can Bitcoin continue beyond this point? Absolutely. However, the result could lead to a parabolic run up similar to June 2019. You remember what happened afterward right? The point I am trying to drive is DO NOT FOMO. Bitcoin will pull back at some point. The question is will you be buying?
From an Elliott wave perspective please view the chart below. I highlighted each correction. So far, highlighted in blue, between the December 2017 - December 2018 is a zig zag ABC correction (A). Currently, highlighted in grey (b) retraced nearly 90% of (a) and Bitcoin has reacted off the low impulsively. Conclusion: Bitcoin and the broad crypto space are beginning the (c) wave to complete the larger (B) wave. The targets are 90% of the larger (A). So targets are approaching $16,500 - nearly $20,000.
It isn't far fetched that Bitcoin return to $20,000. The bigger question is what happens afterward? If this is a large flat correction, Bitcoin could retrace all the way back down to $3,000 after $20,000. Wouldn't that be amazing? I wouldn't bet against it.
In the short term, Bitcoin is over extended and heading into the weekend I'd be expecting some shenanigans. Ultimately, I am a buyer on the dip, preferably a dip to the 0.618 fib of the completion of this move up. Bias: Bullish.
Finally a Bull Market?
MAYBE. Although, I am ready to say BTFD and HODL until approximately $16,500 - $20,000, I am not ready to say that this is the bull run everyone is anticipating. Remember, crypto is still very young and immature. There is a lot of hope riding on a bull run. Loads of people will begin clamoring that Bitcoin is digital gold... etc. What if we just treat Bitcoin and crypto in general as a tech. Similar to all those stock on the Nasdaq the cryptocurrency market has been a leader since the March low. In fact, I'd say the cryptocurrency market has never been so correlated to the stock market. It has nearly gone in lock step all month long.
As a final note, some cryptocurrencies I believe will outpace Bitcoin in USD gains are Ripple and Bitcoin Cash. These crypto's have very bullish set ups and I will share them on a later post!
More than a GAP?
As I was writing this post Bitcoin had just filled the CME Gap at around $9090. This may be significant a significant top. Since the CME opened its Bitcoin futures, the Gaps have for the most part been filled up. Now that it is filled, what can we expect going forward from the King of Crypto!
On the chart above you can see that Bitcoin is knocking right into resistance, a level in which served as the rejection that led to the strong sell off in March. Can Bitcoin continue beyond this point? Absolutely. However, the result could lead to a parabolic run up similar to June 2019. You remember what happened afterward right? The point I am trying to drive is DO NOT FOMO. Bitcoin will pull back at some point. The question is will you be buying?
From an Elliott wave perspective please view the chart below. I highlighted each correction. So far, highlighted in blue, between the December 2017 - December 2018 is a zig zag ABC correction (A). Currently, highlighted in grey (b) retraced nearly 90% of (a) and Bitcoin has reacted off the low impulsively. Conclusion: Bitcoin and the broad crypto space are beginning the (c) wave to complete the larger (B) wave. The targets are 90% of the larger (A). So targets are approaching $16,500 - nearly $20,000.
It isn't far fetched that Bitcoin return to $20,000. The bigger question is what happens afterward? If this is a large flat correction, Bitcoin could retrace all the way back down to $3,000 after $20,000. Wouldn't that be amazing? I wouldn't bet against it.
In the short term, Bitcoin is over extended and heading into the weekend I'd be expecting some shenanigans. Ultimately, I am a buyer on the dip, preferably a dip to the 0.618 fib of the completion of this move up. Bias: Bullish.
Finally a Bull Market?
MAYBE. Although, I am ready to say BTFD and HODL until approximately $16,500 - $20,000, I am not ready to say that this is the bull run everyone is anticipating. Remember, crypto is still very young and immature. There is a lot of hope riding on a bull run. Loads of people will begin clamoring that Bitcoin is digital gold... etc. What if we just treat Bitcoin and crypto in general as a tech. Similar to all those stock on the Nasdaq the cryptocurrency market has been a leader since the March low. In fact, I'd say the cryptocurrency market has never been so correlated to the stock market. It has nearly gone in lock step all month long.
As a final note, some cryptocurrencies I believe will outpace Bitcoin in USD gains are Ripple and Bitcoin Cash. These crypto's have very bullish set ups and I will share them on a later post!