BTC/US – Fibonacci Speed Resistance Fans & Fibonacci Trend Lines
With this chart I would like to show how you can build a dynamic trade view – as opposed to a static one – using Fibonacci tools that are available in TradingView.
After a major market top or market bottom you can draw a Fibonacci Speed Resistance Fan. Here I have drawn two such fans: one after the BTC Februari 2018 major bottom (around USD 6,000), and one after the early March 2018 minor bottom (around USD 7,200).
What you can understand from these fans is how Fibonacci analysis applies to speed lines. And what happens when a speed line is broken to the downside, and the price tries to find support at the next speed line.
I don’t know much about Elliott Wave analysis, but I suspect that understanding a Fib speed resistance fan gives you a thorough understanding of the Fibonacci basics of Elliott Wave analysis. Or in other words, how Elliott waves are Fibonacci speed resistance lines in origin.
I have applied it here to a 4-hour chart, which is one of my favourite charts, in between a day chart and a 1-hour chart. But you can equally apply it to a 1-hour chart, with even more detail. But for the purpose of this publication I have used a 4-hour chart, in order to give a clearer presentation.
And then, when you see that a trend line is forming, you can draw a Fibonacci Trend Line. Here I have drawn one after the double top (around USD 12,000) in early March 2018.
It is amazing how closely the price action follows these drawings – which goes to show how thoroughly Fibonacci the whole process fundamentally is.
I have also drawn other major support and resistance lines – in black. Numbers one and two originate in the major market top of 17 December 2017 (slightly lower than USD 20,000) – but still continue to influence the price action in March 2018.
And support line 3 originates in the market top of late February (around USD 12,000), but still continues to play out after the double market top later on in March 2018.
In fact, what later on appear as falling wedges have their origin in earlier tops – which shows how price/time is all connected in one system, which in my view can be best studied through Fibonacci analysis.
Moreover, I believe that market makers and big whales purposely apply Fibonacci parameters, in order to keep the charts “clean” on all timeframes, so that they can continue to make huge profits through their automatic bot trading. Without such “clean” Fibonacci price/time action their automatic trading would stop working flawlessly anymore. That is why, in my opinion, you can trust that the Big Players will always continue to maintain their Fibonacci parameters. And I see proof of that in the price action time and time again.
In this chart I have left out the relevant moving averages, because otherwise the chart would become too dense for the purpose of this presentation. But in a later chart I will try to add these moving averages, in order to further improve the dynamic market view.
The market cannot predicted, because it is all about testing support and resistance – which may fail or may hold. But surely, proper Fibonacci analysis can give you a profound dynamic market view, which allows you to find high probability trades.
Best of luck with your trades/investments.
After a major market top or market bottom you can draw a Fibonacci Speed Resistance Fan. Here I have drawn two such fans: one after the BTC Februari 2018 major bottom (around USD 6,000), and one after the early March 2018 minor bottom (around USD 7,200).
What you can understand from these fans is how Fibonacci analysis applies to speed lines. And what happens when a speed line is broken to the downside, and the price tries to find support at the next speed line.
I don’t know much about Elliott Wave analysis, but I suspect that understanding a Fib speed resistance fan gives you a thorough understanding of the Fibonacci basics of Elliott Wave analysis. Or in other words, how Elliott waves are Fibonacci speed resistance lines in origin.
I have applied it here to a 4-hour chart, which is one of my favourite charts, in between a day chart and a 1-hour chart. But you can equally apply it to a 1-hour chart, with even more detail. But for the purpose of this publication I have used a 4-hour chart, in order to give a clearer presentation.
And then, when you see that a trend line is forming, you can draw a Fibonacci Trend Line. Here I have drawn one after the double top (around USD 12,000) in early March 2018.
It is amazing how closely the price action follows these drawings – which goes to show how thoroughly Fibonacci the whole process fundamentally is.
I have also drawn other major support and resistance lines – in black. Numbers one and two originate in the major market top of 17 December 2017 (slightly lower than USD 20,000) – but still continue to influence the price action in March 2018.
And support line 3 originates in the market top of late February (around USD 12,000), but still continues to play out after the double market top later on in March 2018.
In fact, what later on appear as falling wedges have their origin in earlier tops – which shows how price/time is all connected in one system, which in my view can be best studied through Fibonacci analysis.
Moreover, I believe that market makers and big whales purposely apply Fibonacci parameters, in order to keep the charts “clean” on all timeframes, so that they can continue to make huge profits through their automatic bot trading. Without such “clean” Fibonacci price/time action their automatic trading would stop working flawlessly anymore. That is why, in my opinion, you can trust that the Big Players will always continue to maintain their Fibonacci parameters. And I see proof of that in the price action time and time again.
In this chart I have left out the relevant moving averages, because otherwise the chart would become too dense for the purpose of this presentation. But in a later chart I will try to add these moving averages, in order to further improve the dynamic market view.
The market cannot predicted, because it is all about testing support and resistance – which may fail or may hold. But surely, proper Fibonacci analysis can give you a profound dynamic market view, which allows you to find high probability trades.
Best of luck with your trades/investments.
Comment:
I shall give you the exact parameters, so that you can study the current sell-off in BTC (27 March 2018) in the context of an accurately drawn Fibonacci Speed Resistance Fan. So, draw a Fib Speed Resistance Fan with price 1 set at 7240 on 18 March 2018. And project price 2 at 11600 on 3 April 2018. Then you can study the sell-off on 26 March, 27 March, 28 March, and so on. You can best study it by zooming in on the 1-hour chart. You will see that every time the price falls to a lower speed line. It is amazingly accurate. And this will give you a profound understanding of how price action works out, and more importantly: why it does so. Good luck.
Comment:
I forgot to mention that you also need to use a 1-hour 55-MA (moving average). Then you can see that during these days (around 26/27 March 2018) this 1-hour 55-MA acts as resistance.
It is all Fibonacci.