LTCBTC: A TreatDasin Triangle Strategy
Many have been asking for an update on the following Published chart:
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And more specifically, just exactly what I was getting at with my fairly cryptic update showing the following chart snapshot:
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It is now time to provide the more in depth analysis and some clarity as to why I am certain there is a huge move to the upside that is in progress (since my initial published chart on the LTCBTC ratio the price has rallied and subsequently pulled back). While I have dug into the lower time frames in more recent updates, I haven't touched on the Monthly chart and, more importantly, I have not explicitly revealed how the Triple Zig Zag Correction (see: Magic Juaned published chart above) fits into the historical count, what that count is, and what it means going forward.
As you will see by the end of this analysis, and as I have *hinted throughout, the ratio has been in a Wave D corrective rally ever since completing the Triple Zig-Zag shown earlier. A Triple Zig-Zag is a Non-Standard Correction composed of a series of three Zig Zags (Standard Corrections) namely W, Y, and Z, that are connected by two 'Small' X Waves. So, the sequence of Progress Labels W-X-Y-X-Z comprise the entire five wave move whereby Waves W, Y, and Z move directionally 'with' the Trend of the larger Non Standard Correction and Waves X and X move against it or Counter to the Trend. By the end of this I will make the case that this Non-Standard Correction is itself (Positionally) a larger degree Wave C. Even a beginner can tell you that a Wave D, in it of itself, implies a leg of a Triangle. To ensure we are all on the same page as I break this all down, see the following snapshot:
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-I have seperated the Monthly line chart into 5 sections that we can easily refer to labeled M0, M1, M2, M3, and M4. The exchange used (on this and all other) presented Charts within this Post was Bitfinex. The LTCBTC 'Pair,' is the tradeable market of one Cryptocurrency (Litecoin) 'paired' against another Cryptocurrency (Bitcoin), which is often referred to as the LTCBTC Ratio. Naturally, due to arbitrage, the Pair does closely track the actual ratio of LTCUSD to BTCUSD. Must I explain what USD is? Perhaps so in the future. Yes, that was a jab.
The LTCBTC Ratio is in a Contracting Triange. To be precise, the Contracting Triangle is an 'Abnormal' (an Elliot Wave term with a distinct meaning and logic used in ^Glen Neely's book "Mastering Elliot Wave"), Horizontal Triangle. As mentioned, the Triple Zig Zag is in the Position of Wave C (on the prior chart the section labeled M3). Waves A and B will be shown to be the two preceding sections M1 and M2. At the risk of redundancy, let me again state that not only is M3 is a Correction (in Structure), but more specifically, it is a Triple Zig Zag, a vital premise that informs my analysis. If you disagree with this, an alternative explanation will need to be provided--should you hope to even merit my response. This alternative explanation will also have to fit into some kind of sensible, larger, Elliot Wave Count. The sentiment behind these requirements will be a common theme and applies to the larger count I will be presenting as well. To be frank: demonstrate your count or gtfo.
^Note: Apparently there was a co-author, so technically, the book was written 'with Eric Hall'
Part 1:
Introduction:
Before getting into my charts, it is essential to lay out the requisite groundwork that will arm the audience with the appropriate level of understanding needed to approach such a sophisticated (for people who aren't me) subject matter. The following can largely be derived both implicitly and explicitly from Glen Neely's book, with perhaps, a few additional eXtensions of my own. In the case of the latter, I will simply be touching on a couple of ideas I have already spoken about at length, but mostly filling in the gap of what is said in the book by being left unsaid, as well as pointing out subtle nuances that are frequently overlooked by the reader. There have been many books written on the broader subject of what I will call "Wave Theory" yet there is only one (Title and other information mentioned earlier) necessary to read. Read it if you will, but if you will, read it. After reading it a few thousand more times, eventually you will find that everything. is. there. for. a. reason.
The link below is the first video in one of my long (this should be taken to mean Time-wise unless otherwise specified) published video series:
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It is mostly about the Chart Scaling and Measurement tools that should be used on any and all explosive growth assets such as Cryptocurrencies. Oh and I should clarify that by 'published' I of course mean on Tradingview, as opposed to the (less important) Academic process of 'Peer Review.' And it is with this in mind I will politely suggest all of my esteemed fellow Tradingview peers to 'throw a Like' at cha boy should you enjoy or agree with this Post (oh and there will be multiple parts FYI). Anyway, in the older, above linked video series, I do get a bit into the difference between measuring and searching for the 'Internal' and 'External' relationships often found in various Wave Types, mostly building upon the foundations set in the book. Admittedly, like all of my video series which spend hours tackling the near-impossible task of summarizing and effectively explaining a highly complex subject matter and chopping it up into digestable chunks of content, errors were likely made along the way and later corrected and/or clarified. Off the top of my head, a point I failed to make clear applies to the Elliot Wave topic of Internal vs External Relationships: Time necessarily applies discretely to Waves, in other words, two distinct waves can not independently share a given range in time. The relevance being that this property is NOT common to Price: Two distinct waves *can independently share a given range in Price (at different points in time).
While the above may seem obvious, it was not an easy idea to communicate on the spot, and it's truth depends upon the precision of language used. For instance, without the key word "Independently," the first statement is, at least, in part, wrong: it is entirely true to state that two distinct waves *of a larger pattern* can and do share the same range of time. As in, Waves A and C of larger Wave Z share (or 'exist within' (Not: "The two kids shared silly ideas about waves with the rest of the class.")) the same 20 month range, does that make sense? Hopefully it provides one piece of the puzzle that is this topic, let's give you a few more.
As we are shown in the book, there are different approaches to searching for relationships between and amongst waves. As you may know by now, relationships in Time are the most important, yet relationships in Price are meaningful as well. With respect to Price and/or Time, the measurement of 'Internal' Relationships between or amongst waves is, perhaps, fairly intuitive: The change in Price and/or Time of a given wave is compared with another wave (or waveS). Due to the fact that distinct waves can independently occupy the same range in Price, but can *not independently occupy the same range in Time, External relationships (as defined in the book) can only be found in Price. So you see, given the hope and belief there is a significance in measuring two or more waves such that their overlapping range in Price is taken into account (outside of the context of 'Retracement'), a seperate approach was created to 'externally' compare waves.
Note Preface: The long (too long) series of paragraphs that follow, between the dashed (not dotted (there is a difference you know)) lines, are a clarification of word choice. Feel free to move past it and onto the continuation of my analysis.
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Note: In three different instances above the word 'range' is intentionally used over the words 'level,' 'point'/'period,' and 'duration.' While it is also technically true that, in the case of Time for example, two waves can not independently share the same duration in Time, the use of this particular word fails to most properly communicate the intended concept: The word duration, in it of itself, implies such is applied to a singular noun. Thus, to state that it does not, can not, or should not be applied to more than one noun is closer to explicitly reaffirming the definition of the word as opposed to actually conveying anything meaningful.
The intention here is to 'speak to' a concept that revolves around, on the contrary, multiple nounS (in this case waves) and their degree of ability (really, their degree of ability--with respect to--their innate quality) to achieve: a sharing of a span in time. A range in time is a 'construct' that exists, linguistically at least, independent of the nouns that 'occupy' it, or 'share' it, or 'anything' it. Conversely, a duration in time is, again, inherently suggesting a given 'things'' (possesive s, **one thing, not: multiple thingS**) 'occupation' of it. So, it is easy to see how the word range much more effectively communicates the idea, which is really a bringing to bare the qualitative difference of how waveS (quite specifically 'Plural') interrelate, with respect to Price, and then, with respect to Time.
Much easier to explain is the incorrect choice of the words level (in terms of Price) or period (logic wise--as put forth by the book (hint))/point (in terms of Time). In this case, such a word choice would not only not effectively communicate the idea, but it would unequivocally state it incorrectly. Take for example, a Zig Zag Correction: The idea is that Waves A and C can not independently share (again) the same range in Time as Wave B, yet they can and do share the same range in Price as Wave B. To substitute the words level or period/point would, in either case, be categorically incorrect: The size of Wave B in Price is most certainly not a level, and, the length of Wave B in Time is most certainly not a Point or Period (by the books logic). Caution: do not confuse the semantic presentation of the argument with the argument itself. The description of a change in Price or Time, vs how it is mathematically derived, is not relevant to *this context*, and, *in certain contexts* CAN be used interchangeably. Ironically enough, to take any issue with the truth of the prior statement, despite the fact that it is, of course, true, is to argue *my* initial point (really reply), but for the wrong reasons.
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External to the overlap amongst the two concepts, Retracement seeks to answer a different question: To what extent was the prior waves' progression in Price 'undone?' The focus is on adjacent waves: A wave's change in price is measured in terms of the preceding wave (not necessarily of the same degree, Note: Retracement is a popular tool in wider Technical Analysis). The contemplation is in effect: How much ground was lost? On the other hand, both (in theory) Internal and External approaches measure what I call the 'Price Relativity' between or amongst waves. In this case, the focus shifts towards how to compare the 'size' of *any two or more waves of a Pattern.
Those who have been following me know by now that it is the Internal approach to measuring the Price Relativity of waves which is (by far) more important in the Cryptocurrency markets. As I have said, understanding the concept of Externality is, perhaps, of value, yet it's practical application to counting waves of a Cryptocurrency pair will be rare, if ever.
It might not seem like it, but a tremendous amount of progress has been made towards arriving at the Elliot Wave count on the LTCBTC Ratio (progress towards a goal implies a given direction and depends upon what the goal is). A big part of the stage has been set, let's set the rest.
In the Technical Analysis world, on a chart, the outputs of a Fibonacci Price Measurement tool are often referred to as Fibonacci 'Levels' representing 'Retracements' and 'Extensions.' In the book (again Title mentioned earlier), the concept of a Wave Retracement to a certain numeric 'Level' is frequently used in the logic, diagrams, and examples throughout, yet the terms are mostly defined indirectly, and in one instance: smooshed underneath the heading of 'External' in Chapter 12. Thus, why I felt it necessary to distinguish between the different conceptual aims at play, as it provides an opportunity to uniquely differentiate how all of these terms should be used. From a certain angle, admittedly, it should be stated that each and every one of these ideas are inherently intertwined: So, of course, to pretend they are not all fundamentally inseperable, is to remove the glue that holds them all together. Yet, in another breath, *it is* indeed beneficial for juans' understanding to look through the eyes of each angle.
Note: Let me be clear, and this is very, very important: I do not quite literally mean that each angle has a pair of eyes that can be 'looked through.' In writing (I do not quite literally mean writing as in on a piece of paper) this is called Personification. Reader be advised, T'will do you well to officially proceed with a removing all 'stick like' objects from ana cavities they currently reside in before reading any farther. The allusion implicit within the prior statement is referred to as a 'figure of speech.' Yes, I know--I know, it's all just so hard to understand.
With different angles in mind: it is important to understand how specific Wave Patterns are 'Channeled.' Cracking the historical Count on the LTCBTC Ratio would take most a life time, for me it was a piece of cake (if that cake had three sides, oh and five legs...wHaT kInD oF f'D uP cAkE dO yOu EaT!?). The key is in applying all of the above plus a true understanding of 'how Triangles Channel.' To the beginner, this is easier said than done, so if that's you: Feel free to take my care-free attitude with a necessary grain of salt. Yet for me, saying it will be just as easy as doing it: There are many types of triangles, each with a unique Construction, Logic, and Post-Constructive Logic. For those with ADHD, you might want to PAY ATTENTION HERE: All three of the above are irrevocably intertwined (to use the word of the day) with 'how a given Type of Triangle Channels.'
So wot are these Ehl-E-ot wuaves and Dub-TF is a Triangle? Well, here goes: Triangles are themselves Standard Corrections, yet they can be found (Positionally) within both Standard or Non-Standard Corrections. Remember? We spoke about the categories, didn't we? Structurally, the Triangle Pattern is always Corrective, not Impulsive (it is a ':3' as opposed to a ':5' (but sorry, yes, as odd as it might appear in symbol: *This particular ':3' does in fact have five Segments*)). Constructionally, all Triangles are composed of 5 Counter Directional (to one another, consecutive) Waves or 'Legs.' The sequence of Progress Labels for these waves is as follows: A-B-C-D-E. Each and every Leg (or 'Sub-Wave') of the Triangle must, itself, have a Corrective Structure. Part vs Whole, undastand? Post-Constructively, Triangles can be further and farther behaviorly (no not literally...ehr...you get it, well, perhaps not 'you') categorized into Limiting vs Non-Limiting.
Nominally, these labels loosely refer to the extent of Limitation (or lack thereof) directly placed upon the 'move to follow,' referred to (degree-agnostically) as the 'Thrust.' Yet, it is both A. the Construction of a Triangle (the manner by which its' legs unfold) and B. 'how it Channels' that *Pre-Constructively ('before the fact') and *Constructively ('during the fact') determine its' initial Categorization as Limiting or Non-Limiting, only to be later *Post-Constructively (after the fact) revisited more conclusively(ish). Oh, and by the way, when juan thinks about it deeply enough, this Post-Constructive Logic is, in truth, informed by both the Triangle's Construction and Channeling. Such entertwinement (ze conception of ze followin words havin a baby: intertwine and entertainment), much WOW.
Okay, enough of the foreplay, let's get into the details. No, seriously there's a lot more. Like--a lot--a lot. Beyond falling into the categories of Standard vs Non-Standard, and Limiting vs Non-Limiting, a Triangle must be further and farther categorized based upon the specific manner by which 'it channels.' More generally, **In order to qualify as a Triangle, a Triangle MUST have a 'Clean' B-D Line,** keep this in mind for later. Conversely, there must also be, for lack of a better term, and not because I can't think of it, but rather, because it doesn't exist yet, officially, yet, an opposing Channel line which (also) Cleanly connects two of the three following Waves: Waves A, C, and/or E. Depending upon whether these two lines, moving from left to right, Converge or Diverge, they are grouped into the categories of Expanding vs Contracting Triangles. For completeness, before moving on, I will add that the B-D Line, often referred to as the 'Base Line,' provides in part (in it of itself), a basis for evaluating one 'stage' (the other stage being Wave E itself) of Post-Constructive Logic. Note: Additionally, as I briefly * touched on earlier, the two 'opposing' Channel lines also play a part in informing the Post-Constructive evaluation of the Pattern, yet, as opposed to Stages 1 and 2, the focus is on the 'Thrust(s).'
There are three major Types of Triangles, each of which help classify a Triangle belonging to *any of the three, broader, binary categories previously mentioned: Horizontal, Irregular, and Running. While it is not the only factor, as I will prove in this post, it is *primarily Channeling that determines a Triangles' Classification. Irrespective of how the two opposing Channel lines (Base-Line and 'Contra Base- Line' (my own term (told ya))) 'move' i.e. on an Expanding vs Contracting basis: They will necessarily have an Ascending, Descending, or Horizontal 'bent' to them. When the Channel lines of a Triangle have an Ascending or Descending 'bent,' it is classified as a Running Triangle. We will dive deeper into this all soon enough.
The LTCBTC Ratio Elliot Wave Count:
The LTCBTC Ratio is in an 'Abnormal,' Horizontal (Contracting) Triangle. Before getting into the nitty gritty, first allow me to explain why it must be categorized as a Contracting Triangle. For the sake of brevity amidst a dense post, and with consideration there is much more to come, I will be laying out premises that either:
A. I have covered in the past in much greater detail.
B. I will cover now.
C. Should not be hard to be taken at face value or independently researched, verified, and validated (given the appropriate level of requisite knowledge).
D. Are open to (good faith) refutation in the comments, although I don't expect it. Afterall, I am the greatest to ever live, so there's that.
Moving on. As we should all now know (say that ten times fast, on qualudes (optional)), every leg of a Contracting Triangle must be Corrective in Structure. I will give a brief explanation as to how this applies to the LTCBTC Ratio. Again, each secion of the chart will be referenced as follows:
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Structure and Construction of M1-M3:
M1
Section M1 is clearly Corrective in Structure. To speak qualitatively: In Impulses, the acceleration (steepening) of the trend usually occurs around the middle of a properly proportioned and scaled chart. Clearly, that is not what happens in Section M1. The Segment (in my logic this simply means a not yet categorized or classified wave) can be divided into three (easily discernable) 'Sub-Segments' eligible for inclusion in the Classification of the larger Pattern.
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For the robots: these Sub-Segments (which in the book are tekshualinicly Segments (because the process begins from the perspective of a speck of dust)) should be 'Compacted' as part of the process of, potentially (should god arrive here on earth and bless it), being grouped into a larger Pattern, which might, one day, in theory, actually become part of an Elliot Wave Count, conditional upon Peer Review, but don't count on it.
In contrast to classic impulsive 'behavior' (as described earlier), the second Sub-Segment of the three, moves counter to the trend of the larger Segment, occupying its' middle portion. This behavior is actually more characteristic of Corrective activity. It is important to understand that, by design, it is much harder to satisfy the criteria needed to categorize a Wave as Impulsive in Structure, as opposed to Corrective in Structure. Any structural determination must be accompanied by the necessary underlying 'burden of proof' needed for Impulse Categorization.
In this case, not only is it easy to declare that M1 is 'not an Impulse' (you see what I did there?), but additionally, that it actually 'is a Correction.' Before moving on to Classification, I will also mention the extent of Retracement achieved by Segment M1 (the Section presupposed as eventually becoming a wave in a count, one day, in theory, but let's not jump to any conclusions) in terms of the adjacent, preceding Segment M0: The greater than .618 Retracement of the prior Segment disqualifies the consideration of Segment M1 as an Impulsive Wave A. Post-Constructively, we can say that without an explanation for why Segment M2 failed to fully retrace Segment M1 within the time it took Segment M1 to form (37 months, *for now* just take my word for it, I will show the duration of each Section later, I pinky swear) the remaining edge case arguments for a (non Wave A) Impulse as Segment M1 can be safely ruled out.
All of this is, in reality, beating a horse that has already been sent to the after life. Not only has the preceding and subsequent price action confirmed what I call the 'Market-based Proof of Work' needed to declare Segment M1 as a Correction, but the Construction of the Pattern (now we are graduating from Elementary School and flirting with the process of actually Counting Waves) puts a Cherry on top of it all. M1 is quite clearly a Zig Zag (see below chart):
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-The Equality in Price of what will be *lower Degree* Waves A and C (how is the mood striking you now?) are a tell tale sign of a 'Normal' Zig Zag Correction. In the above Chart, Waves A and C are, of course, measured *Internally (Price-wise) as all Impulses should be, by default. But I'll try to refrain from talking dirty while the kids are still home.
The shallow Retracement of Wave B eliminates all other potential Classifications of the larger Pattern. I should clarify (apparently) that the above conclusion is made exactly within the context of *this Chart*. If that sounds weird, don't worry, it's not you.
Surely, (I'll call you whatever I want) you will also find signs of Impulsive action at a 'polywave or higher' level in both Waves A and C using a lower Interval Time Period (as opposed to the Monthly Time Unit), but such an excersize would be a waste of time as there is nothing that could be found that would impact the Pattern's Classification, given the supporting evidence already taken into account.
The perspective of Complexity *Levels is a topic I have obliterated ad nauseum in many past lectures (I think we are going to have to use protection for this). With an understanding that such a huge number of price changes are large enough to materially register a visible 'wave' on any given chart, I can say unequivocally that any approach to Counting Waves that actually gives significance to the strict, logic-based quantification of an exact number of waves 'in a move' (using Aspect 1, Aspect, the bends, etc) is complete nonsense. As the same book will tell you, given you know how read it (more on this later), not only can waves be 'Missing,' but more importantly, there can be 'visible' waves which are 'incidental.' The reality that some, perhaps even more than not, depending on your chart proportion and scaling, waves will inevitably be found to be incidental makes the rigid enforcement of these rules, well, silly. Yes, silly. Even attempting to apply them is an utter waste of time. Once you graduate high school you will realize that all of these 'rules' are as valuable as their ability to help you find *the best* Count. Rules that relegate each and every count as incorrect should be properly ammended or thrown out. 'What happened last night?'
If the subject is of interest, I have done countless hours on how it should be properly applied, and made plenty of Charts using it correctly, feel free to indulge. With regard to the Zig Zag (okay fine but it has got to be a quickie), in the rigid sense, Wave B would be too 'simple' to be grouped with more intricate Waves A and C 'by the book.' For those living in reality, where the goal of Elliot Wave is to actually explain and predict Price Action, it is easy to acknowledge how insignificant (to wildly understate it) such a minor issue is to the Classification of a Zig Zag. Even the book itself will support everything I have said, just in a more subtle tone, and implicitly. Using my correct ammended approach to the determination of a waves' of 'Complexity Level': One or perhaps even two of Waves A and C would likely fall under the label of what I have called a 'Complex Mono,' in other words a (Level 0) Monowave, 'whos'' visible subdivisions provide a hint of a more specific Wave Type at a lower Time Interval (in this instance: a hint of which Sub-Impulse is the eXtended wave).
Other means of 'wiggle room' are provided throughout the Beaty Method such as the allowance for Missing B Waves, Candle Stick Measurement of a specific 'end' of a Wave, the Effectivity of the end of waves (two or more 'effective ends' of a Wave *for different purposes*), etc. The goal of these techniques is to enable the actual Counting of Waves in order to explain and predict Price Action. Markets are dynamic, any approach that fails to appreciate this can be cast into the depths of Academic circle-jerking about Fictional markets. Ironically, in this post I will be revealing a 'historical count' which analyzes the entire history of a Market Pair in a more cold, calculated, extensive manner.
Anywhoo, one of these days I'll have to tell you what I *really* think. Back to it.
M2
M2 and M3 Structurally are 'not Impulses.' The best Classification for M2 is a Truncated Zig Zag:
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-The equality in Time between Waves A and C is yet another tell tale sign of a Zig Zag. Due to the small size of Wave C (Less than 61.8 % increase in Price compared to Wave A), the Zig Zag must necessarily be labeled as a 'Truncated Zig Zag.' Of Sections M1-M3, the Patterns *Direct* Classification is, perhaps, the least conclusive, yet: it is fairly easy to conclude (even directly). Yes.
The Candle Stick Measurement used to measure the 'end' of Wave C is only relevant to the extent that it nudges the size of Wave C above the 38.2 % threshold needed relative to Wave A (Internally, of course). Yet, it is essential to understand that the same technique would be needed (on a different wave) in order to argue for the next most likely Classification (a Flat Correction). By all means, feel free to imploy any and all of my custom tecniques, as always, but you will have a hard time finding enough (if any) evidence in support of a Flat Correction. Equality in Price, Time, or both is, again, a classic characteristic of Zig Zags. Alternatively, it is rare that a Flat would not posses at a minimum, a Time-based Relationship amongst *all three* waves. Amongst other things, the above points provide a strong rationale for the relevant, relative Classification, and are sufficient enough to close the case.
M3
M3 is a Triple Zig Zag Correction. Structurally, again, it is decisively 'not an Impulse.' If anything, the only potential for Impulsive action anywhere in the viscinity of the Section, would require an inclusion of the Price action in Section M4, and such a consideration would fall under the more exotic Classification of an eXtended 3rd wave Terminal Impulse. Fear not, I will sufficiently dismantle such a notion (which of course no juan else could have even conceived of themselves) later in the post. For now, we will stick with the premise that the end of Section M3 represents 'the end of a major elliot wave correction,' as the data Directly, emphatically tells us. In other words: Constructionally (Careful: not 'Constructively') everything about the Segment *and Sub-Segments scream "Triple Zig Zag." So much so that I would frame the earlier sentence about any consideration of Impulsive activity as I have, that is to say: there is no doubt the Patterns' 'Integrity' will be maintained in Posterity (Pos-Ter-ily? ...Pos-a-bree).
There is simply no other way to count the five-wave move (using sound Elliot Wave principles) other than a series of three Standard Corrections (Zig Zags) connected by two 'Small' X Waves comprising the larger Non-Standard Correction. More generally, each chart Section (M1-M3) should be viewed through the lens of a 'Polywave or higher' Wave by virtue of the fact that each Segment subdivides. In this realm, it is basically Time, Time Rules, Price, Complexity (not necessarily Levels), and Channeling that Directly inform Degree. With this in mind, it will be extremely hard to even present a plausible explanation for M3 as anything other than a Wave composed of five Sub-Waves *of the same degree.* Given this is acknowledged, as well as the clear Trending (as opposed to Non-Trending) nature of the Wave, the question becomes: Is this Wave an Impulse (of any variety) or is it a Non-Standard Correction (containing two 'small' X Sub-Waves)?
From this perspective, the answer is conclusively that M3 is 'not an Impulse,' yet, here the same burden of proof idea is applied Constructionally (not Structurally). In this instance, Structure, and its' baggage, are a by-product of Wave Type. To argue for an Impulse would require the satisfying of a swath of criteria one part of which is applied to the eXtended Wave. Constructionally, the eXtended Wave would determine the supposed Impulses' Wave Type, in order to be eligible for comaprison to what is clearly a Triple Zig Zag Correction. As much as I would like to consider such a Classification, it is unclear just exactly which part of the five-wave (Sub-wave) move would qualify as a candidate for the eXtended (Sub-Impulsive) Wave, at least not with consideration of all the other criteria needed to be satisfied for an Impulse Classification.
On the other hand, again, everything present in the five-wave move actively supports a Triple Zig Zag Classification. Charts speak loader than words, and with that, see the following Published Chart focused on Section M3:
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-Above all, Channeling is the biggest factor that contributes to the Patterns Classification. The 'exposed' Channel * 'Touch Points,' in a broader sense, suggest the behavior between Parallel Channel Lines is Corrective. More specifically, the larger Pattern 'channels as a Non-Standard' should in that there is a Clean 'B-B Line' that is, without coincidence, paralleled by an opposing Channel Line with more than one, relevant degree, 'Touch.' Note: Careful here, what the interaction with these Channel Lines imply Degree-wise is very different in an Impulse.
***Boring but neccessary part of the post is now complete...if you like Counting Waves that is***
The LTCBTC Ratio is in a Triangle:
As I mentioned, there would be a common theme throughout this post: Put up or shut up. The whole, larger post more than sufficiently supports *what the Count is*, I have no interest in giving the microphone to any retort, refutation, or other that does not offer up its' own competing Count for me to shatter into pieces.
Everything written so far, supports the notion that the LTCBTC Ratio is 'in a Triangle,' I will now speak directly from the perspective of a potential Triangle Categorization. It bares mentioning that, the lack of a strong case for any other Category of Pattern is, itself, in support of the Pair being in a Triangle.
So, what suggests the LTCBTC Ratio is in a Triangle? The Classification of Sections M1-M3, especially so in M2 and M3, in it of itself, *strongly suggests that the market is currently in a Triangle. First off, aside from Wave E, no leg of a Triangle is permitted to be, itself, a Triangle. The fact that each of the three Sections are not 'themselves' a Triangle, is in alignment with the conclusion of the larger Pattern being 'in a Triangle' (no wave is disqualified from being a leg of a Triangle).
Henceforth, I will largely be referring to these Sections 'Positionally' as Waves or Legs of a Triangle (as Coach used to say: "if you can dream it you can do it"). Wave A (M1) is the first leg of the Triangle. As touched upon, Wave A is a 'Normal' Zig Zag Correction. There is not much to be taken from this other than the fact that a. It is not itself a Triangle and b. The 'Normal' Zig Zag Wave Type will *rarely be the largest leg* of a Triangle, this will come in handy later.
Wave B (M2) is a Truncated Zig Zag. The conclusion that the LTCBTC Ratio is 'in a Triangle,' already has legs (so to speak) in that the Classification of a wave as a Truncated Zig Zag, is a HUGE indication of Triangular activity. An indication which can not be discounted. It also begins to shed light on both what Type of Triangle the Ratio is in, and how far along in it 'we are.' Due to the Power Implications of the Pattern, more specifically, the Counter Trend Strength implied by the weakness of Wave C, a Truncated Zig Zag will *frequently be found preceding the largest leg* of the Triangle. This will also come in handy later, and is already of use in that, due to the bigger picture, we know that is highly unlikely this Truncated Zig Zag is in the Position of Wave A. Thus, by process of elimination, its' Position would have to be Leg B, C, or D. More on this later.
Wave C (M3) is a Triple Zig Zag. Triple Zig Zags are a very rare Pattern, and I quote:
"Triple Zig Zag
This is the most powerful corrective pattern that can occur. If its movement is downward it implies the market is currently very weak. If its movement is upward the market is currently very strong. A Triple Zig Zag will hardly ever be seen but, when it does occur it is usually the longest segment of a Terminal or Triangle. When part of a Terminal pattern, it should definitely be the Extended segment. Based on market position, if a Terminal is not possible, the only choice is that the Triple Zig Zag is the largest Segment of a Triangle. If part of a Flat correction or Contracting Triangle, a Triple Zig Zag can never be completely retraced by the pattern which immediately follows it of the same degree."
Advanced Logic Rules Chapter 10-3
Mastering Elliot Wave by Glen Neely
As I will be dismantling later, the market is not 'in' either a Flat Correction or a Terminal Impulse. In other words, the market is 'in a Triangle,' and the Triple Zig Zag is its' largest Segment! Does it make sense that the largest leg of a Triangle would follow a Truncated Zig Zag?! You tell me. Not only does the conclusion of the LTCBTC Ratio 'being in a Triangle' have some strong legs to stand on, but there is already a strong argument to be made that Sections M1-M3 represent three consecutive, adjacent Legs of a Triangle, and what I will soon show are Waves A, B, and C of a Contracting Triangle.
The LTCBTC Ratio is in a Contracting Triangle:
In having provided the rationale needed to safely conclude that the LTCBTC Ratio is in a some kind of Triangle, the groundwork has now been layed out to further and farther categorize the Pattern. More broadly, a careful and appropriate measurement of the Price and Time taken by each Leg (and/or potential Leg) of the Triangle will be half the battle. More narrowly, Channeling will help build the foundation and seal the deal for this analysis, especially in the later stages. Before the Triangle can be Classified, we must first Categorize it as a Contracting vs Expanding.
With the following statement, the keen reader might begin to notice a pattern forming: Part of what informs the LTCBTC Ratio 'being in a Contracting Triangle' is the ruling out of it 'being in an Expanding Triangle' (This will be covered at Length in Part Two). As it would happen, a careful and thoughtful approach to measuring the 'size' (change in Price) and 'duration' (span of Time) of each Leg (and/or potential Leg) will greatly inform such a Categorization, both directly, and indirectly (in shaping 'how the Triangle might channel'). With foreknowledge that measuring the Duration of each Leg will be fairly straight-forward, and that we must inevitably enter the more 'heated' measuring of the Size of each Leg in Price (keep calm mah babies), I will begin with Time. Then, I will speak to Price *strictly sticking to how it applies to this portion of the post*, and leave any discussion of 'size' for the remaining topics, where its' nuance will be tediously explored. No stone will be left unturned (what, were you expecting something dirty? You guys are a a bunch of sickos.).
Since this portion of the post is dedicated specifically to the Categorization of a Contracting vs Expanding Triangle, I will put forth an important point to consider: Contrary to what this Categorization might imply in other scenarios, on the LTCBTC Ratio Historical Chart, interestingly enough, given the current 'position of the market,' an Expanding Triangle Categorization would actually, by implication, suggest an (on net much more (at a minimum equally)) bullish set of scenarios for the supposed next Leg. With that said, it is not in an Expanding Triangle. So, how does Time and Price usually occur in each of these Categories of Triangle?
In either case, Time and Price are of great significance. In any Triangle, the relevant waves eligible for comparison are essentially all waves that 'move' in the same direction: Waves A, C, and E are compared, and similarly, Waves B and D are compared. It is no surprise that the type of Relationship juan must look for, with respect to Price and Time, in these Legs, is a Fibonacci Relationship. What sets apart the two Categories of Triangle is the frequency these Relationships are found: A Contracting Triangle *must* have at least one Fibonacci Relationship (in Price and/or Time) *in each set* of relevant waves, where as, conversely, an Expanding Triangle is characterized by its' lack of Fibonacci Relationships and can have *at most* one *total (regardless of which set of waves it might be found in).
Next I will present two charts, one of which is focused on Time, the other on Price. The second of the two covers a lot, some of which I have not yet touched on will be explained shortly:
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-Price
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-Time
Caution: Here is where the post starts to get sophisticated, THE FOLLOWING IS FOR ADVANCED STUDENTS ONLY.
In the second chart, I have began using the Progress Labels A, B, and C which suggest a Position for each Triangle Leg. Categorization aside (for a second), I will first speak to the data shown, and what might be of importance in a Triangle. Like the ealier Charts, these and all future Charts are using the Monthly Time Interval, *on a Log Scale*, using the exchange Bitfinex's historical data. Again, if you take any issue with the use of Log Scale, feel free to watch the hours and hours of video I have done on this, it is without a doubt the correct scale, even on a coin paired against another. There has never been anything more certain in the history of the world. If you really disagree, feel free to wait until the end of the post to hear just how silly you are. Moving on.
Of note Time-wise, is the existence of a Fibonacci Relationship between Legs A and C: Wave C is about 138.2% Times Wave A (37 Months * 1.382 = ~51). This Fibonacci Relationship exists Internally, between the relevant set of waves. We will go much deeper into what type of measurement approach is needed where, and why. Price-wise, Internally, Wave B underwent a ~515% increase in Price, Waves A and C underwent an ~87% and ~91% decrease in Price respectively. There is much to be said about all of this, but for now I will simply note the absence of any Fibonacci Relationship between the relevant waves (Waves A and C) in Price.
What is missing from the story? If you remember, there are five Legs to a Triangle, so, inherent to these Charts are the suggestion that Waves D is *currently in progress* and eventually, after the coming rally, there will be a Wave E to follow. Thus: how the phrase 'being *in* a Triangle' applies to the LTCBTC Ratio. There is still yet much to cover, and necessarily so in a certain order, be patient I will get to it all (believe me I know, it was already written).
-Nas (loose attribution)
Seriously though, I already wrote it all.
Many have been asking for an update on the following Published chart:
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And more specifically, just exactly what I was getting at with my fairly cryptic update showing the following chart snapshot:
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It is now time to provide the more in depth analysis and some clarity as to why I am certain there is a huge move to the upside that is in progress (since my initial published chart on the LTCBTC ratio the price has rallied and subsequently pulled back). While I have dug into the lower time frames in more recent updates, I haven't touched on the Monthly chart and, more importantly, I have not explicitly revealed how the Triple Zig Zag Correction (see: Magic Juaned published chart above) fits into the historical count, what that count is, and what it means going forward.
As you will see by the end of this analysis, and as I have *hinted throughout, the ratio has been in a Wave D corrective rally ever since completing the Triple Zig-Zag shown earlier. A Triple Zig-Zag is a Non-Standard Correction composed of a series of three Zig Zags (Standard Corrections) namely W, Y, and Z, that are connected by two 'Small' X Waves. So, the sequence of Progress Labels W-X-Y-X-Z comprise the entire five wave move whereby Waves W, Y, and Z move directionally 'with' the Trend of the larger Non Standard Correction and Waves X and X move against it or Counter to the Trend. By the end of this I will make the case that this Non-Standard Correction is itself (Positionally) a larger degree Wave C. Even a beginner can tell you that a Wave D, in it of itself, implies a leg of a Triangle. To ensure we are all on the same page as I break this all down, see the following snapshot:
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-I have seperated the Monthly line chart into 5 sections that we can easily refer to labeled M0, M1, M2, M3, and M4. The exchange used (on this and all other) presented Charts within this Post was Bitfinex. The LTCBTC 'Pair,' is the tradeable market of one Cryptocurrency (Litecoin) 'paired' against another Cryptocurrency (Bitcoin), which is often referred to as the LTCBTC Ratio. Naturally, due to arbitrage, the Pair does closely track the actual ratio of LTCUSD to BTCUSD. Must I explain what USD is? Perhaps so in the future. Yes, that was a jab.
The LTCBTC Ratio is in a Contracting Triange. To be precise, the Contracting Triangle is an 'Abnormal' (an Elliot Wave term with a distinct meaning and logic used in ^Glen Neely's book "Mastering Elliot Wave"), Horizontal Triangle. As mentioned, the Triple Zig Zag is in the Position of Wave C (on the prior chart the section labeled M3). Waves A and B will be shown to be the two preceding sections M1 and M2. At the risk of redundancy, let me again state that not only is M3 is a Correction (in Structure), but more specifically, it is a Triple Zig Zag, a vital premise that informs my analysis. If you disagree with this, an alternative explanation will need to be provided--should you hope to even merit my response. This alternative explanation will also have to fit into some kind of sensible, larger, Elliot Wave Count. The sentiment behind these requirements will be a common theme and applies to the larger count I will be presenting as well. To be frank: demonstrate your count or gtfo.
^Note: Apparently there was a co-author, so technically, the book was written 'with Eric Hall'
Part 1:
Introduction:
Before getting into my charts, it is essential to lay out the requisite groundwork that will arm the audience with the appropriate level of understanding needed to approach such a sophisticated (for people who aren't me) subject matter. The following can largely be derived both implicitly and explicitly from Glen Neely's book, with perhaps, a few additional eXtensions of my own. In the case of the latter, I will simply be touching on a couple of ideas I have already spoken about at length, but mostly filling in the gap of what is said in the book by being left unsaid, as well as pointing out subtle nuances that are frequently overlooked by the reader. There have been many books written on the broader subject of what I will call "Wave Theory" yet there is only one (Title and other information mentioned earlier) necessary to read. Read it if you will, but if you will, read it. After reading it a few thousand more times, eventually you will find that everything. is. there. for. a. reason.
The link below is the first video in one of my long (this should be taken to mean Time-wise unless otherwise specified) published video series:
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It is mostly about the Chart Scaling and Measurement tools that should be used on any and all explosive growth assets such as Cryptocurrencies. Oh and I should clarify that by 'published' I of course mean on Tradingview, as opposed to the (less important) Academic process of 'Peer Review.' And it is with this in mind I will politely suggest all of my esteemed fellow Tradingview peers to 'throw a Like' at cha boy should you enjoy or agree with this Post (oh and there will be multiple parts FYI). Anyway, in the older, above linked video series, I do get a bit into the difference between measuring and searching for the 'Internal' and 'External' relationships often found in various Wave Types, mostly building upon the foundations set in the book. Admittedly, like all of my video series which spend hours tackling the near-impossible task of summarizing and effectively explaining a highly complex subject matter and chopping it up into digestable chunks of content, errors were likely made along the way and later corrected and/or clarified. Off the top of my head, a point I failed to make clear applies to the Elliot Wave topic of Internal vs External Relationships: Time necessarily applies discretely to Waves, in other words, two distinct waves can not independently share a given range in time. The relevance being that this property is NOT common to Price: Two distinct waves *can independently share a given range in Price (at different points in time).
While the above may seem obvious, it was not an easy idea to communicate on the spot, and it's truth depends upon the precision of language used. For instance, without the key word "Independently," the first statement is, at least, in part, wrong: it is entirely true to state that two distinct waves *of a larger pattern* can and do share the same range of time. As in, Waves A and C of larger Wave Z share (or 'exist within' (Not: "The two kids shared silly ideas about waves with the rest of the class.")) the same 20 month range, does that make sense? Hopefully it provides one piece of the puzzle that is this topic, let's give you a few more.
As we are shown in the book, there are different approaches to searching for relationships between and amongst waves. As you may know by now, relationships in Time are the most important, yet relationships in Price are meaningful as well. With respect to Price and/or Time, the measurement of 'Internal' Relationships between or amongst waves is, perhaps, fairly intuitive: The change in Price and/or Time of a given wave is compared with another wave (or waveS). Due to the fact that distinct waves can independently occupy the same range in Price, but can *not independently occupy the same range in Time, External relationships (as defined in the book) can only be found in Price. So you see, given the hope and belief there is a significance in measuring two or more waves such that their overlapping range in Price is taken into account (outside of the context of 'Retracement'), a seperate approach was created to 'externally' compare waves.
Note Preface: The long (too long) series of paragraphs that follow, between the dashed (not dotted (there is a difference you know)) lines, are a clarification of word choice. Feel free to move past it and onto the continuation of my analysis.
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Note: In three different instances above the word 'range' is intentionally used over the words 'level,' 'point'/'period,' and 'duration.' While it is also technically true that, in the case of Time for example, two waves can not independently share the same duration in Time, the use of this particular word fails to most properly communicate the intended concept: The word duration, in it of itself, implies such is applied to a singular noun. Thus, to state that it does not, can not, or should not be applied to more than one noun is closer to explicitly reaffirming the definition of the word as opposed to actually conveying anything meaningful.
The intention here is to 'speak to' a concept that revolves around, on the contrary, multiple nounS (in this case waves) and their degree of ability (really, their degree of ability--with respect to--their innate quality) to achieve: a sharing of a span in time. A range in time is a 'construct' that exists, linguistically at least, independent of the nouns that 'occupy' it, or 'share' it, or 'anything' it. Conversely, a duration in time is, again, inherently suggesting a given 'things'' (possesive s, **one thing, not: multiple thingS**) 'occupation' of it. So, it is easy to see how the word range much more effectively communicates the idea, which is really a bringing to bare the qualitative difference of how waveS (quite specifically 'Plural') interrelate, with respect to Price, and then, with respect to Time.
Much easier to explain is the incorrect choice of the words level (in terms of Price) or period (logic wise--as put forth by the book (hint))/point (in terms of Time). In this case, such a word choice would not only not effectively communicate the idea, but it would unequivocally state it incorrectly. Take for example, a Zig Zag Correction: The idea is that Waves A and C can not independently share (again) the same range in Time as Wave B, yet they can and do share the same range in Price as Wave B. To substitute the words level or period/point would, in either case, be categorically incorrect: The size of Wave B in Price is most certainly not a level, and, the length of Wave B in Time is most certainly not a Point or Period (by the books logic). Caution: do not confuse the semantic presentation of the argument with the argument itself. The description of a change in Price or Time, vs how it is mathematically derived, is not relevant to *this context*, and, *in certain contexts* CAN be used interchangeably. Ironically enough, to take any issue with the truth of the prior statement, despite the fact that it is, of course, true, is to argue *my* initial point (really reply), but for the wrong reasons.
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External to the overlap amongst the two concepts, Retracement seeks to answer a different question: To what extent was the prior waves' progression in Price 'undone?' The focus is on adjacent waves: A wave's change in price is measured in terms of the preceding wave (not necessarily of the same degree, Note: Retracement is a popular tool in wider Technical Analysis). The contemplation is in effect: How much ground was lost? On the other hand, both (in theory) Internal and External approaches measure what I call the 'Price Relativity' between or amongst waves. In this case, the focus shifts towards how to compare the 'size' of *any two or more waves of a Pattern.
Those who have been following me know by now that it is the Internal approach to measuring the Price Relativity of waves which is (by far) more important in the Cryptocurrency markets. As I have said, understanding the concept of Externality is, perhaps, of value, yet it's practical application to counting waves of a Cryptocurrency pair will be rare, if ever.
It might not seem like it, but a tremendous amount of progress has been made towards arriving at the Elliot Wave count on the LTCBTC Ratio (progress towards a goal implies a given direction and depends upon what the goal is). A big part of the stage has been set, let's set the rest.
In the Technical Analysis world, on a chart, the outputs of a Fibonacci Price Measurement tool are often referred to as Fibonacci 'Levels' representing 'Retracements' and 'Extensions.' In the book (again Title mentioned earlier), the concept of a Wave Retracement to a certain numeric 'Level' is frequently used in the logic, diagrams, and examples throughout, yet the terms are mostly defined indirectly, and in one instance: smooshed underneath the heading of 'External' in Chapter 12. Thus, why I felt it necessary to distinguish between the different conceptual aims at play, as it provides an opportunity to uniquely differentiate how all of these terms should be used. From a certain angle, admittedly, it should be stated that each and every one of these ideas are inherently intertwined: So, of course, to pretend they are not all fundamentally inseperable, is to remove the glue that holds them all together. Yet, in another breath, *it is* indeed beneficial for juans' understanding to look through the eyes of each angle.
Note: Let me be clear, and this is very, very important: I do not quite literally mean that each angle has a pair of eyes that can be 'looked through.' In writing (I do not quite literally mean writing as in on a piece of paper) this is called Personification. Reader be advised, T'will do you well to officially proceed with a removing all 'stick like' objects from ana cavities they currently reside in before reading any farther. The allusion implicit within the prior statement is referred to as a 'figure of speech.' Yes, I know--I know, it's all just so hard to understand.
With different angles in mind: it is important to understand how specific Wave Patterns are 'Channeled.' Cracking the historical Count on the LTCBTC Ratio would take most a life time, for me it was a piece of cake (if that cake had three sides, oh and five legs...wHaT kInD oF f'D uP cAkE dO yOu EaT!?). The key is in applying all of the above plus a true understanding of 'how Triangles Channel.' To the beginner, this is easier said than done, so if that's you: Feel free to take my care-free attitude with a necessary grain of salt. Yet for me, saying it will be just as easy as doing it: There are many types of triangles, each with a unique Construction, Logic, and Post-Constructive Logic. For those with ADHD, you might want to PAY ATTENTION HERE: All three of the above are irrevocably intertwined (to use the word of the day) with 'how a given Type of Triangle Channels.'
So wot are these Ehl-E-ot wuaves and Dub-TF is a Triangle? Well, here goes: Triangles are themselves Standard Corrections, yet they can be found (Positionally) within both Standard or Non-Standard Corrections. Remember? We spoke about the categories, didn't we? Structurally, the Triangle Pattern is always Corrective, not Impulsive (it is a ':3' as opposed to a ':5' (but sorry, yes, as odd as it might appear in symbol: *This particular ':3' does in fact have five Segments*)). Constructionally, all Triangles are composed of 5 Counter Directional (to one another, consecutive) Waves or 'Legs.' The sequence of Progress Labels for these waves is as follows: A-B-C-D-E. Each and every Leg (or 'Sub-Wave') of the Triangle must, itself, have a Corrective Structure. Part vs Whole, undastand? Post-Constructively, Triangles can be further and farther behaviorly (no not literally...ehr...you get it, well, perhaps not 'you') categorized into Limiting vs Non-Limiting.
Nominally, these labels loosely refer to the extent of Limitation (or lack thereof) directly placed upon the 'move to follow,' referred to (degree-agnostically) as the 'Thrust.' Yet, it is both A. the Construction of a Triangle (the manner by which its' legs unfold) and B. 'how it Channels' that *Pre-Constructively ('before the fact') and *Constructively ('during the fact') determine its' initial Categorization as Limiting or Non-Limiting, only to be later *Post-Constructively (after the fact) revisited more conclusively(ish). Oh, and by the way, when juan thinks about it deeply enough, this Post-Constructive Logic is, in truth, informed by both the Triangle's Construction and Channeling. Such entertwinement (ze conception of ze followin words havin a baby: intertwine and entertainment), much WOW.
Okay, enough of the foreplay, let's get into the details. No, seriously there's a lot more. Like--a lot--a lot. Beyond falling into the categories of Standard vs Non-Standard, and Limiting vs Non-Limiting, a Triangle must be further and farther categorized based upon the specific manner by which 'it channels.' More generally, **In order to qualify as a Triangle, a Triangle MUST have a 'Clean' B-D Line,** keep this in mind for later. Conversely, there must also be, for lack of a better term, and not because I can't think of it, but rather, because it doesn't exist yet, officially, yet, an opposing Channel line which (also) Cleanly connects two of the three following Waves: Waves A, C, and/or E. Depending upon whether these two lines, moving from left to right, Converge or Diverge, they are grouped into the categories of Expanding vs Contracting Triangles. For completeness, before moving on, I will add that the B-D Line, often referred to as the 'Base Line,' provides in part (in it of itself), a basis for evaluating one 'stage' (the other stage being Wave E itself) of Post-Constructive Logic. Note: Additionally, as I briefly * touched on earlier, the two 'opposing' Channel lines also play a part in informing the Post-Constructive evaluation of the Pattern, yet, as opposed to Stages 1 and 2, the focus is on the 'Thrust(s).'
There are three major Types of Triangles, each of which help classify a Triangle belonging to *any of the three, broader, binary categories previously mentioned: Horizontal, Irregular, and Running. While it is not the only factor, as I will prove in this post, it is *primarily Channeling that determines a Triangles' Classification. Irrespective of how the two opposing Channel lines (Base-Line and 'Contra Base- Line' (my own term (told ya))) 'move' i.e. on an Expanding vs Contracting basis: They will necessarily have an Ascending, Descending, or Horizontal 'bent' to them. When the Channel lines of a Triangle have an Ascending or Descending 'bent,' it is classified as a Running Triangle. We will dive deeper into this all soon enough.
The LTCBTC Ratio Elliot Wave Count:
The LTCBTC Ratio is in an 'Abnormal,' Horizontal (Contracting) Triangle. Before getting into the nitty gritty, first allow me to explain why it must be categorized as a Contracting Triangle. For the sake of brevity amidst a dense post, and with consideration there is much more to come, I will be laying out premises that either:
A. I have covered in the past in much greater detail.
B. I will cover now.
C. Should not be hard to be taken at face value or independently researched, verified, and validated (given the appropriate level of requisite knowledge).
D. Are open to (good faith) refutation in the comments, although I don't expect it. Afterall, I am the greatest to ever live, so there's that.
Moving on. As we should all now know (say that ten times fast, on qualudes (optional)), every leg of a Contracting Triangle must be Corrective in Structure. I will give a brief explanation as to how this applies to the LTCBTC Ratio. Again, each secion of the chart will be referenced as follows:
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Structure and Construction of M1-M3:
M1
Section M1 is clearly Corrective in Structure. To speak qualitatively: In Impulses, the acceleration (steepening) of the trend usually occurs around the middle of a properly proportioned and scaled chart. Clearly, that is not what happens in Section M1. The Segment (in my logic this simply means a not yet categorized or classified wave) can be divided into three (easily discernable) 'Sub-Segments' eligible for inclusion in the Classification of the larger Pattern.
Note:
For the robots: these Sub-Segments (which in the book are tekshualinicly Segments (because the process begins from the perspective of a speck of dust)) should be 'Compacted' as part of the process of, potentially (should god arrive here on earth and bless it), being grouped into a larger Pattern, which might, one day, in theory, actually become part of an Elliot Wave Count, conditional upon Peer Review, but don't count on it.
In contrast to classic impulsive 'behavior' (as described earlier), the second Sub-Segment of the three, moves counter to the trend of the larger Segment, occupying its' middle portion. This behavior is actually more characteristic of Corrective activity. It is important to understand that, by design, it is much harder to satisfy the criteria needed to categorize a Wave as Impulsive in Structure, as opposed to Corrective in Structure. Any structural determination must be accompanied by the necessary underlying 'burden of proof' needed for Impulse Categorization.
In this case, not only is it easy to declare that M1 is 'not an Impulse' (you see what I did there?), but additionally, that it actually 'is a Correction.' Before moving on to Classification, I will also mention the extent of Retracement achieved by Segment M1 (the Section presupposed as eventually becoming a wave in a count, one day, in theory, but let's not jump to any conclusions) in terms of the adjacent, preceding Segment M0: The greater than .618 Retracement of the prior Segment disqualifies the consideration of Segment M1 as an Impulsive Wave A. Post-Constructively, we can say that without an explanation for why Segment M2 failed to fully retrace Segment M1 within the time it took Segment M1 to form (37 months, *for now* just take my word for it, I will show the duration of each Section later, I pinky swear) the remaining edge case arguments for a (non Wave A) Impulse as Segment M1 can be safely ruled out.
All of this is, in reality, beating a horse that has already been sent to the after life. Not only has the preceding and subsequent price action confirmed what I call the 'Market-based Proof of Work' needed to declare Segment M1 as a Correction, but the Construction of the Pattern (now we are graduating from Elementary School and flirting with the process of actually Counting Waves) puts a Cherry on top of it all. M1 is quite clearly a Zig Zag (see below chart):
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-The Equality in Price of what will be *lower Degree* Waves A and C (how is the mood striking you now?) are a tell tale sign of a 'Normal' Zig Zag Correction. In the above Chart, Waves A and C are, of course, measured *Internally (Price-wise) as all Impulses should be, by default. But I'll try to refrain from talking dirty while the kids are still home.
The shallow Retracement of Wave B eliminates all other potential Classifications of the larger Pattern. I should clarify (apparently) that the above conclusion is made exactly within the context of *this Chart*. If that sounds weird, don't worry, it's not you.
Surely, (I'll call you whatever I want) you will also find signs of Impulsive action at a 'polywave or higher' level in both Waves A and C using a lower Interval Time Period (as opposed to the Monthly Time Unit), but such an excersize would be a waste of time as there is nothing that could be found that would impact the Pattern's Classification, given the supporting evidence already taken into account.
The perspective of Complexity *Levels is a topic I have obliterated ad nauseum in many past lectures (I think we are going to have to use protection for this). With an understanding that such a huge number of price changes are large enough to materially register a visible 'wave' on any given chart, I can say unequivocally that any approach to Counting Waves that actually gives significance to the strict, logic-based quantification of an exact number of waves 'in a move' (using Aspect 1, Aspect, the bends, etc) is complete nonsense. As the same book will tell you, given you know how read it (more on this later), not only can waves be 'Missing,' but more importantly, there can be 'visible' waves which are 'incidental.' The reality that some, perhaps even more than not, depending on your chart proportion and scaling, waves will inevitably be found to be incidental makes the rigid enforcement of these rules, well, silly. Yes, silly. Even attempting to apply them is an utter waste of time. Once you graduate high school you will realize that all of these 'rules' are as valuable as their ability to help you find *the best* Count. Rules that relegate each and every count as incorrect should be properly ammended or thrown out. 'What happened last night?'
If the subject is of interest, I have done countless hours on how it should be properly applied, and made plenty of Charts using it correctly, feel free to indulge. With regard to the Zig Zag (okay fine but it has got to be a quickie), in the rigid sense, Wave B would be too 'simple' to be grouped with more intricate Waves A and C 'by the book.' For those living in reality, where the goal of Elliot Wave is to actually explain and predict Price Action, it is easy to acknowledge how insignificant (to wildly understate it) such a minor issue is to the Classification of a Zig Zag. Even the book itself will support everything I have said, just in a more subtle tone, and implicitly. Using my correct ammended approach to the determination of a waves' of 'Complexity Level': One or perhaps even two of Waves A and C would likely fall under the label of what I have called a 'Complex Mono,' in other words a (Level 0) Monowave, 'whos'' visible subdivisions provide a hint of a more specific Wave Type at a lower Time Interval (in this instance: a hint of which Sub-Impulse is the eXtended wave).
Other means of 'wiggle room' are provided throughout the Beaty Method such as the allowance for Missing B Waves, Candle Stick Measurement of a specific 'end' of a Wave, the Effectivity of the end of waves (two or more 'effective ends' of a Wave *for different purposes*), etc. The goal of these techniques is to enable the actual Counting of Waves in order to explain and predict Price Action. Markets are dynamic, any approach that fails to appreciate this can be cast into the depths of Academic circle-jerking about Fictional markets. Ironically, in this post I will be revealing a 'historical count' which analyzes the entire history of a Market Pair in a more cold, calculated, extensive manner.
Anywhoo, one of these days I'll have to tell you what I *really* think. Back to it.
M2
M2 and M3 Structurally are 'not Impulses.' The best Classification for M2 is a Truncated Zig Zag:
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-The equality in Time between Waves A and C is yet another tell tale sign of a Zig Zag. Due to the small size of Wave C (Less than 61.8 % increase in Price compared to Wave A), the Zig Zag must necessarily be labeled as a 'Truncated Zig Zag.' Of Sections M1-M3, the Patterns *Direct* Classification is, perhaps, the least conclusive, yet: it is fairly easy to conclude (even directly). Yes.
The Candle Stick Measurement used to measure the 'end' of Wave C is only relevant to the extent that it nudges the size of Wave C above the 38.2 % threshold needed relative to Wave A (Internally, of course). Yet, it is essential to understand that the same technique would be needed (on a different wave) in order to argue for the next most likely Classification (a Flat Correction). By all means, feel free to imploy any and all of my custom tecniques, as always, but you will have a hard time finding enough (if any) evidence in support of a Flat Correction. Equality in Price, Time, or both is, again, a classic characteristic of Zig Zags. Alternatively, it is rare that a Flat would not posses at a minimum, a Time-based Relationship amongst *all three* waves. Amongst other things, the above points provide a strong rationale for the relevant, relative Classification, and are sufficient enough to close the case.
M3
M3 is a Triple Zig Zag Correction. Structurally, again, it is decisively 'not an Impulse.' If anything, the only potential for Impulsive action anywhere in the viscinity of the Section, would require an inclusion of the Price action in Section M4, and such a consideration would fall under the more exotic Classification of an eXtended 3rd wave Terminal Impulse. Fear not, I will sufficiently dismantle such a notion (which of course no juan else could have even conceived of themselves) later in the post. For now, we will stick with the premise that the end of Section M3 represents 'the end of a major elliot wave correction,' as the data Directly, emphatically tells us. In other words: Constructionally (Careful: not 'Constructively') everything about the Segment *and Sub-Segments scream "Triple Zig Zag." So much so that I would frame the earlier sentence about any consideration of Impulsive activity as I have, that is to say: there is no doubt the Patterns' 'Integrity' will be maintained in Posterity (Pos-Ter-ily? ...Pos-a-bree).
There is simply no other way to count the five-wave move (using sound Elliot Wave principles) other than a series of three Standard Corrections (Zig Zags) connected by two 'Small' X Waves comprising the larger Non-Standard Correction. More generally, each chart Section (M1-M3) should be viewed through the lens of a 'Polywave or higher' Wave by virtue of the fact that each Segment subdivides. In this realm, it is basically Time, Time Rules, Price, Complexity (not necessarily Levels), and Channeling that Directly inform Degree. With this in mind, it will be extremely hard to even present a plausible explanation for M3 as anything other than a Wave composed of five Sub-Waves *of the same degree.* Given this is acknowledged, as well as the clear Trending (as opposed to Non-Trending) nature of the Wave, the question becomes: Is this Wave an Impulse (of any variety) or is it a Non-Standard Correction (containing two 'small' X Sub-Waves)?
From this perspective, the answer is conclusively that M3 is 'not an Impulse,' yet, here the same burden of proof idea is applied Constructionally (not Structurally). In this instance, Structure, and its' baggage, are a by-product of Wave Type. To argue for an Impulse would require the satisfying of a swath of criteria one part of which is applied to the eXtended Wave. Constructionally, the eXtended Wave would determine the supposed Impulses' Wave Type, in order to be eligible for comaprison to what is clearly a Triple Zig Zag Correction. As much as I would like to consider such a Classification, it is unclear just exactly which part of the five-wave (Sub-wave) move would qualify as a candidate for the eXtended (Sub-Impulsive) Wave, at least not with consideration of all the other criteria needed to be satisfied for an Impulse Classification.
On the other hand, again, everything present in the five-wave move actively supports a Triple Zig Zag Classification. Charts speak loader than words, and with that, see the following Published Chart focused on Section M3:
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-Above all, Channeling is the biggest factor that contributes to the Patterns Classification. The 'exposed' Channel * 'Touch Points,' in a broader sense, suggest the behavior between Parallel Channel Lines is Corrective. More specifically, the larger Pattern 'channels as a Non-Standard' should in that there is a Clean 'B-B Line' that is, without coincidence, paralleled by an opposing Channel Line with more than one, relevant degree, 'Touch.' Note: Careful here, what the interaction with these Channel Lines imply Degree-wise is very different in an Impulse.
***Boring but neccessary part of the post is now complete...if you like Counting Waves that is***
The LTCBTC Ratio is in a Triangle:
As I mentioned, there would be a common theme throughout this post: Put up or shut up. The whole, larger post more than sufficiently supports *what the Count is*, I have no interest in giving the microphone to any retort, refutation, or other that does not offer up its' own competing Count for me to shatter into pieces.
Everything written so far, supports the notion that the LTCBTC Ratio is 'in a Triangle,' I will now speak directly from the perspective of a potential Triangle Categorization. It bares mentioning that, the lack of a strong case for any other Category of Pattern is, itself, in support of the Pair being in a Triangle.
So, what suggests the LTCBTC Ratio is in a Triangle? The Classification of Sections M1-M3, especially so in M2 and M3, in it of itself, *strongly suggests that the market is currently in a Triangle. First off, aside from Wave E, no leg of a Triangle is permitted to be, itself, a Triangle. The fact that each of the three Sections are not 'themselves' a Triangle, is in alignment with the conclusion of the larger Pattern being 'in a Triangle' (no wave is disqualified from being a leg of a Triangle).
Henceforth, I will largely be referring to these Sections 'Positionally' as Waves or Legs of a Triangle (as Coach used to say: "if you can dream it you can do it"). Wave A (M1) is the first leg of the Triangle. As touched upon, Wave A is a 'Normal' Zig Zag Correction. There is not much to be taken from this other than the fact that a. It is not itself a Triangle and b. The 'Normal' Zig Zag Wave Type will *rarely be the largest leg* of a Triangle, this will come in handy later.
Wave B (M2) is a Truncated Zig Zag. The conclusion that the LTCBTC Ratio is 'in a Triangle,' already has legs (so to speak) in that the Classification of a wave as a Truncated Zig Zag, is a HUGE indication of Triangular activity. An indication which can not be discounted. It also begins to shed light on both what Type of Triangle the Ratio is in, and how far along in it 'we are.' Due to the Power Implications of the Pattern, more specifically, the Counter Trend Strength implied by the weakness of Wave C, a Truncated Zig Zag will *frequently be found preceding the largest leg* of the Triangle. This will also come in handy later, and is already of use in that, due to the bigger picture, we know that is highly unlikely this Truncated Zig Zag is in the Position of Wave A. Thus, by process of elimination, its' Position would have to be Leg B, C, or D. More on this later.
Wave C (M3) is a Triple Zig Zag. Triple Zig Zags are a very rare Pattern, and I quote:
"Triple Zig Zag
This is the most powerful corrective pattern that can occur. If its movement is downward it implies the market is currently very weak. If its movement is upward the market is currently very strong. A Triple Zig Zag will hardly ever be seen but, when it does occur it is usually the longest segment of a Terminal or Triangle. When part of a Terminal pattern, it should definitely be the Extended segment. Based on market position, if a Terminal is not possible, the only choice is that the Triple Zig Zag is the largest Segment of a Triangle. If part of a Flat correction or Contracting Triangle, a Triple Zig Zag can never be completely retraced by the pattern which immediately follows it of the same degree."
Advanced Logic Rules Chapter 10-3
Mastering Elliot Wave by Glen Neely
As I will be dismantling later, the market is not 'in' either a Flat Correction or a Terminal Impulse. In other words, the market is 'in a Triangle,' and the Triple Zig Zag is its' largest Segment! Does it make sense that the largest leg of a Triangle would follow a Truncated Zig Zag?! You tell me. Not only does the conclusion of the LTCBTC Ratio 'being in a Triangle' have some strong legs to stand on, but there is already a strong argument to be made that Sections M1-M3 represent three consecutive, adjacent Legs of a Triangle, and what I will soon show are Waves A, B, and C of a Contracting Triangle.
The LTCBTC Ratio is in a Contracting Triangle:
In having provided the rationale needed to safely conclude that the LTCBTC Ratio is in a some kind of Triangle, the groundwork has now been layed out to further and farther categorize the Pattern. More broadly, a careful and appropriate measurement of the Price and Time taken by each Leg (and/or potential Leg) of the Triangle will be half the battle. More narrowly, Channeling will help build the foundation and seal the deal for this analysis, especially in the later stages. Before the Triangle can be Classified, we must first Categorize it as a Contracting vs Expanding.
With the following statement, the keen reader might begin to notice a pattern forming: Part of what informs the LTCBTC Ratio 'being in a Contracting Triangle' is the ruling out of it 'being in an Expanding Triangle' (This will be covered at Length in Part Two). As it would happen, a careful and thoughtful approach to measuring the 'size' (change in Price) and 'duration' (span of Time) of each Leg (and/or potential Leg) will greatly inform such a Categorization, both directly, and indirectly (in shaping 'how the Triangle might channel'). With foreknowledge that measuring the Duration of each Leg will be fairly straight-forward, and that we must inevitably enter the more 'heated' measuring of the Size of each Leg in Price (keep calm mah babies), I will begin with Time. Then, I will speak to Price *strictly sticking to how it applies to this portion of the post*, and leave any discussion of 'size' for the remaining topics, where its' nuance will be tediously explored. No stone will be left unturned (what, were you expecting something dirty? You guys are a a bunch of sickos.).
Since this portion of the post is dedicated specifically to the Categorization of a Contracting vs Expanding Triangle, I will put forth an important point to consider: Contrary to what this Categorization might imply in other scenarios, on the LTCBTC Ratio Historical Chart, interestingly enough, given the current 'position of the market,' an Expanding Triangle Categorization would actually, by implication, suggest an (on net much more (at a minimum equally)) bullish set of scenarios for the supposed next Leg. With that said, it is not in an Expanding Triangle. So, how does Time and Price usually occur in each of these Categories of Triangle?
In either case, Time and Price are of great significance. In any Triangle, the relevant waves eligible for comparison are essentially all waves that 'move' in the same direction: Waves A, C, and E are compared, and similarly, Waves B and D are compared. It is no surprise that the type of Relationship juan must look for, with respect to Price and Time, in these Legs, is a Fibonacci Relationship. What sets apart the two Categories of Triangle is the frequency these Relationships are found: A Contracting Triangle *must* have at least one Fibonacci Relationship (in Price and/or Time) *in each set* of relevant waves, where as, conversely, an Expanding Triangle is characterized by its' lack of Fibonacci Relationships and can have *at most* one *total (regardless of which set of waves it might be found in).
Next I will present two charts, one of which is focused on Time, the other on Price. The second of the two covers a lot, some of which I have not yet touched on will be explained shortly:
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-Price
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-Time
Caution: Here is where the post starts to get sophisticated, THE FOLLOWING IS FOR ADVANCED STUDENTS ONLY.
In the second chart, I have began using the Progress Labels A, B, and C which suggest a Position for each Triangle Leg. Categorization aside (for a second), I will first speak to the data shown, and what might be of importance in a Triangle. Like the ealier Charts, these and all future Charts are using the Monthly Time Interval, *on a Log Scale*, using the exchange Bitfinex's historical data. Again, if you take any issue with the use of Log Scale, feel free to watch the hours and hours of video I have done on this, it is without a doubt the correct scale, even on a coin paired against another. There has never been anything more certain in the history of the world. If you really disagree, feel free to wait until the end of the post to hear just how silly you are. Moving on.
Of note Time-wise, is the existence of a Fibonacci Relationship between Legs A and C: Wave C is about 138.2% Times Wave A (37 Months * 1.382 = ~51). This Fibonacci Relationship exists Internally, between the relevant set of waves. We will go much deeper into what type of measurement approach is needed where, and why. Price-wise, Internally, Wave B underwent a ~515% increase in Price, Waves A and C underwent an ~87% and ~91% decrease in Price respectively. There is much to be said about all of this, but for now I will simply note the absence of any Fibonacci Relationship between the relevant waves (Waves A and C) in Price.
What is missing from the story? If you remember, there are five Legs to a Triangle, so, inherent to these Charts are the suggestion that Waves D is *currently in progress* and eventually, after the coming rally, there will be a Wave E to follow. Thus: how the phrase 'being *in* a Triangle' applies to the LTCBTC Ratio. There is still yet much to cover, and necessarily so in a certain order, be patient I will get to it all (believe me I know, it was already written).
-Nas (loose attribution)
Seriously though, I already wrote it all.
