Continuation of bullish retracement in play for BTC

BTC shows early signs of a bullish will to keep retracing its huge dump formed on the daily time frame.

Arguments in favor of this bullish scenario :

• the huge dump of mid november / mid december has only retraced to 0.382 fib so far
  
• a continuation of bear market would probably lead to new bottom. Too violent for hodlers this quick ;-)
  
• Elliott count requires at least another impulse upwards to complete an ABC on the daily
  
• We are starting to get a convincing Elliott count in favor of the bulls on lower time frames
  
• We have already reached the 0.618 golden pocket retracement of previous bullish impulse
  
• Purple channel is too beautiful to be ignored
  

Arguments against this bullish scenario :

• there is an alternative Elliott count where purple C is the (A) and purple 1 is the (B) leading to a C wave retesting 3500 support, which would postpone later in time and lower in targets the bullish case. Yet, this alternative count is less attractive on lower time frames in terms of Elliott counts
  
• until yellow channel has not been broken upwards, and 4100 resistance has not been retested and broken, the downtrend is still in play
  
• we have yet to see confirmation higher highs and higher lows on the 4h time frame
  

I have been watching sideways action closely during last days, and decided to enter a long position early, before confirmation, at 3868, with a very tight stop-loss at 3769, to mitigate the risk of an early positioning, allowing the possibility of a short trade if bullish case is denied. Here, the careful trader should at least wait for yellow channel to be broken and another higher low to be formed before entering a long position. Resume of bearish trend upon retest of yellow resistance is highly possible within next 24 hours.

Targets here are hard for me to figure, and I will wait and see how price action unfolds before taking a hypothetical profit.
Potential take-profit zones to watch are :

• 4100 : last lower high
  
• 4400 : 3 local tops, key level, 0.618 fib extension of previous bullish impulse, time to take partial profit at least
  
• 4800 : last hurdle, 1:1 fib extension, nothing impressive though
  
• 5600 : dream target, 1.618 fib extension, retest of pink yearly resistance, too beautiful to be true
  

I'm on the moon bandwagon on this one, before we go down again below 3k...

Comment:

Additional elements :
- SMA 100 on 4h acting as support (bullish)
- SMA 50 on 4h acting as resistance (bearish)
- RSI 4h just bumped off green supprot (bullish)
- MACD 4h just crossed bullish (well, bullish)
- Bitfinex shorts just started piling up (bearish)
- we just entered 2019 (unrelatedish)

Trade active:

Fifth wave up to 4036 strongly in favor of bullish scenario. Up 2.7% so far.

Now expecting retracement downwards to 3880 levels (0.618 fib, strong local support) before another bullish impulse to 4100 levels (1:1 fib extension, last local high).

4100 should be a TP1 for a third or half the position, to secure profit and move the stop-loss to a no-loss stop.

Then, wait and see if we get a third impulse (which I expect) to complete a higher degree impulse. But that's if and after 4100 has been retested. One thing at a time. Let's first confirm that we're out of yellow channel and back into purple bull trend.

Comment:

Volume will be key to decide whether BTC can climb higher than 4100. So far, impulse happened on very low volume, which is more than unconvincing. Bulls be warned, tight management of stop-losses is essential.

Trade active:

TP1 taken at about 4060, due to lack of volume and difficult Elliott count.

Now expecting a retrace to 3880 (0.618 fib of this impulse) to confirm purple channel as support and build up an ascending triangle to break 4100 resistance in convincing volumes later. Planning to reenter full position if a higher low is confirmed or if 4100 breaks convincingly.

Next take-profits at 4400 and 4800 still in mind with a guideline drawing :

Trade active:

So far BTC retracing its last leg up from 3800 to 4100, following childish drawing of previous comment. I played a small scalping short which I closed already in tiny profit.

Still expecting retest of 3900 level : cross of purple and yellow trendlines, 0.618 fib target, confirming previous resistance as new support, building a new healthy higher low.

On micro time frames, my Elliott count is an extended fifth for last leg up, which means a textbook retracement limited by either wave 4 (3920) or wave ii (3920 too !). This is my textbook target for reopening full long position. I have already started laddering my entries.

Re-Opening range = 3800-4000.
Stop-Loss = 3779
Take-Profits = 4100 (if trouble) - 4400 - 4800

Comment:

Trade closed manually:

Development and Elliott count suggests a more complex and possibly more bearish retracement than a simple ABC. Whenever I don't understand a pattern I close my trades and rethink from start.

Profit was already made from first bull swing and short scalp, only lost part of it upon closing reentered long trade.

Trade active:

After reaching a satisfying micro Elliott count I reentered a smaller long trade on BTC and ETH (pre-fork hype). It seems the ascending triangle towards a breakout of 4100 resistance is still in play.

Yet, sideways action in low volumes should make one wary : breakout will be quick and strong both in price action and volume, and right now it could go either way.

Trade closed: stop reached:

Another leg down shakes me out due to my tight stop-loss. This makes me neutral until a clear direction is decided, by breaking in serious volumes either the 4100 resistance for an uptrend, or all the potential supports in this last chart for a downtrend.

I end up this series of trades in a small profit. Better than nothing ;-)

Comment:

Comment:

Backwards conclusion : bullish scenario seemed correct from the start, but it took time to get there. I ended up placing stop orders to prepare for both a bullish and bearish scenario. I am now in a long position from 4076, riding the most likely bullish impulse which is starting.