The chart speaks for itself. The current market structure looks like the last micro cycle on the 1D chart. There is nothing bullish in the short term unless price gets over the pink rectangle.
How important is the next low? Very!
If this chart was zoomed out a bit you’d see a noticeable downtrend, then as seen here a low followed by a higher high. This current micro cycle is important because a higher low also means a higher low on the large downtrend. If that is the case then the next low has the potential to provide great returns.
It’s comical at this point that these XRP market structures are continuing to repeat. It was fun 3 years ago, helpful 2 years ago, and down right bizzare last year that the XRPBTC bubbles have stayed near carbon copies of previous years. Why can this happen? In my opinion the largest market force and its algo/trading bot(s) are the same force and with little to no reprogramming of movement. Obvious assumption is a Brad Garlinghouse and Ripple funding connection.
What Does This Mean For The Future?
I am making this article just as I made most of the updates on the original Tradingview post, as seen HERE , which is at key pivot points. It seems crazy this continues to play out, and if it does decide to break away from the pattern it will be at a pivot point. In this situation the pivot point is defined as a turning point between 2 smaller market cycles within the greater bubble cycle. I believe this is a pivot time.
The data suggest XRPBTC is going to drift down and the next low may be “the low”. XRPUSD has also held shape fairly well. It also suggests a retrace into “the low”. This bubble cycle has been a bit longer which is a factor that can cause delay. The USD pairing suggests movement is possible in 6 weeks. The BTC pairing suggests movement is more likely in 6 months.
It’s been fun so far. Hopefully the next update is the one we’ve been waiting for.
Back in March Bitcoin showed itself to be pa risk-off trade because of the Coronavirus pandemic. The fear of a lack of liquidity ravaged almost all global markets. Bitcoin was not spared.
The subsequent rally throughout April has done a solid FIB retrace and the retail raid zones on the 4H & 1D charts have provided resistance zones so far.
With halving in less than 2 weeks and a near complete recovery of the sell off this will certainly entice bears to try and push their weight around again soon.
BTCUSD has been moving along with stock markets as the world is trying to calculate what is fair value and what risk is worth taking on. Bitcoin will likely be an analog of the larger marketplace because liquidity is impacted across all markets when greed or fear is at play.
The pattern noted above, and some minor variations of it, are noticeable throughout the history of this market’s price history. I first noticed it while using BBands but removed them for this post because it’s far too busy looking with the extra lines.
Anatomy of the algo
After a bear market push a Head & Shoulders pattern develops as it bounces from the Lower BBand up-and-through the Upper BBand (not seen for reasons noted above). That is followed by a double top (2 pushes) with 2 strong retraces. Variations of the algo are more present on the 3rd push towards highs. The volume profile tends to echo the price action as well.
Currently there is wonky Head & Shoulders in the works with the price recently bouncing off the Lower BBand. History of the algo would suggest a bit of consolidation before picking a direction for a new measured move.
The XAUUSD chart (right) shows Gold priced in US Dollars continuing to show strength over the last 18 months of what seems like never ending global crisis situations.
Gold as seen in most non USD markets has made new all time highs (ATH’s). Canada is used as the comparative example because it is a G7 country and has a history of stable governments and resource development. The fact Gold is running away from the old ATH shows that every nation, even America, that risk happens fast.
Possible Cup & Handle
There is a case to made for a Cup & Handle (C&H) formation on the XAUCAD chart, and if so the measured move has recently reached its general target area. The Coronavirus wave is starting to wane in Canada and that could be a reason to cause a pull back from the C&H measured move high.
If the above were to happen that would result in some consolidation of the XAUUSD chart. That would create perfect conditions for the handle to form on the chart.
Unseen risk factors and/or more Coronavirus complications could create a more volatile upswing. However, for the time being there we want to only focus on the chart that is before us. The chart tells a detailed story and the unseen levels of debt & restructuring being piled on nations certainly can be the trigger for Gold priced in USD to make new ATH’s.
The SCMR system noted on the chart has now hit 6 out of 6 times. LTC is now in a 6th bull market…or maybe it ended??? Let’s take a look at the most probable options based on history and market models. Why are we even speculating you ask? Because this current rally has echos of the smallest previous rally of the signal noted above.
Bull bias is dip buying the current uptrend channel. Their narrative is strong based on the 4 of 5 previous bull markets that produced greater than 150% gains, it fell just short of 50% this time. They’ll likely be buyer until a red candle prints.
A general bullish market bias will likely remain strong even if the market moves like the black line on the far right which creates an obvious range trade.
Bearish traders see that the small rally after the last halving rolled off and that price sank very low. The orange resistance line and capped by the red hammer is the Bull/Bear price pivot for now. IF the price does follow the last halving dump fractal perfectly then the low should come in December 2020, just in time for the seasonal altcoin cycle. At least the worst case has an upside right?….right??
The Tezos USD pair has retraced 25% off of the recent all time high. Any time a market gives back close to the 25% number it’s time to start looking for bounces and/or continuation. This is purely from a mathematical market algo perspective.
The 3 green percentage boxes show a fairly congruent 3 Drives pattern that is resolving itself into accelerated selling. The 3rd green box will have a larger total percentage due to accelerated selling, but for the 3 Drives calculations we measure it to support, and then add the acceleration. The most likely accelerated selling bounce targets are the “retail raid” levels and S/R.
The Support/Resistance level is defined by the convergence of the previous bottom and an old high at the same level. The retail raid levels are defined by the breakout above the diagonal downtrend, the spot where most retail traders take the “safest” long.
Accelerated Selling is defined by the panic sellers that let go of a position below trend support. It’s basically the resolution of a Wyckoff Market Model cycle. In this case just a short term pattern.
Accelerated selling tends to be where markets experience the most mass liquidations/margin calls/covering/stop loss triggering within the shortest amount of time. The accelerated stage often fully retraces and therefore becomes the best time to buy. The retraces almost always go back to the support line, and often returns to the top of the old price channel.
Ethereum’s ETH/BTC Weekly pair is on the verge great things, but crypto is far from predicable. Higher time frame structural breakouts have happened twice in the past. The 3rd one brewing right now speaks for itself.
The Higher High and the tepid breakout right now must have the bulls on edge. Holding the horizontal blue box leads to a bull bias next week. A break under the October 2019 highs, thus under the horizontal blue box, will make the bears feel like they are in control again.
BitTorrent’s Chinese connections make it a must watch market.
With all the new interest coming from Chinese officials about Blockchain technology it would be wise to watch markets that have Chinese connections. They will get the most attention and thus most investment input. BTT should be on that watch list.
The first chart is trying ever so hard to flip into “full bull conditions”. That being an overbought StochRSI, a Confirmed Reversal on the SCMR candle system, a cluster of buy volume, and (still waiting on) a blue bar print on my indicator system.
An open of 7 satoshis or higher, with some volume, leaves the door open for a rally to 12 or even 18 depending on how things go.
The second chart shows very tight Bbands. That is a sign to watch a market for a breakout from a range.
The third chart confirms the range and even shows it as a possible Wykoff model forming. All of these points all suggest setting conditional orders and letting the market play out its algorithm.
ETCBTC is looking a lot like BTCUSD was in early 2019. Based on the current location within the pattern it seems like the safest trade is a long above the localized resistance (Red line). New lows with volume will likely invalidate the idea.