|Posted by Brian Fletcher on 24/07/2019||0 Comments|
Investors who want to own Bitcoin will have one last chance before it leaves the price station headed to significantly higher levels.
Those who ignore this sector, will live their lives as normal only to wake up one day and realize they missed the potential to increase their capital by 10 fold.
A complete impulse off the December 2018 low now sets up the next and last opportunity to long Bitcoin.
Since October, 2018, I have published a series of articles here on Seeking Alpha entitled "Bitcoin - The Ride is Just Starting", this being part 4 in this series. In October when Bitcoin (BTC-USD) was at $7,200 USD I suggested in my initial article that would drop into the $2,488 - $4,175 region before heading up to $70,000 to complete Primary Degree Wave (5). With the benefit of hindsight, we now know Bitcoin dropped precisely into our target region. When it hit approximately $3,500, we issued a Trade Alert to our subscribers advising them to take a long term "long" position in BTC. Then in December, 2018 I wrote the following:
In my last article on Bitcoin in October, when it was at $7,200 USD, I provided our price target of $2,488 - $4,175 that could conclude prior to the end of this year. Like clockwork, it's hit this target. In this article I'll reiterate the upside targets and a long term trading plan for how to approach Bitcoin for handsome profits.
In this article I went on to discuss a long term plan for one who allocates capital to this sector in how they could buy one single Bitcoin, and through a long term approach could grow this small amount of capital to an enormous nest egg. Naturally, there was no lack of insults in the comments section, supporting the emotions and extreme sentiment that relates to the cryptocurrency sector.
Below is a copy of the chart I posted in the initial article in October.
In Part 3, published in May I suggested for those who are not already long Bitcoin that we could get a wave 2 pull back to allow for another entry. By way of update, this is still the case. Before reviewing this in more detail, let's take another look at the long term price structure of Bitcoin, starting with the Bitcoin 2 Week Chart below. From an Elliott Wave and Fibonaci perspective, Bitcoin is behaving beautifully. Note on the chart below that wave blue wave (3) of green hit the 1.236 log scale Fib, which is a picture perfect level for wave (3) of 3. It then went on to the 1.764, which is another picture perfect Fibonacci price hit. Keeping in mind that when a wave structure adheres to the Fib levels, it adds considerable overall support and confidence in the larger degree wave structure. The pull back into late 2018 held the 1.382 bottom up Fib level, and has now completed the initial wave (I) of the Primary Degree wave 3 to the 2.0 extension level, which is $70,114. It is this wave structure and the strict adherence to the Fib levels that supports our conviction that Bitcoin is heading higher.
Now, let us turn our attention to the Bitcoin Daily Chart - below. Off the December, 2018 low we can now count a completed 5 wave structure up to $13,794. This means that after the next pull back into the Fibonaci .50 - .764 retrace levels, Bitcoin will embark on a 3rd wave to much higher levels. Assuming we get a pull back into this region, and that it doesn't decide to only provide a shallow retrace instead, this will setup the last and final entry for those either seeking to allocate capital to this sector, or for those seeking to add to existing positions. The proverbial train will leave the station, and for all those cryptocurrency "nay sayers" who refuse to get aboard, they will miss the move.
Now, lastly, let us turn out attention to the 4 hour chart to consider one last potential with Bitcoin, on a shorter time frame. While we view the high in wave (I) most likely in, it is possible that this current pull back from the high established in June is only a wave iv, and that BTC will make one more high into the $15,000 - $17,000 region before pulling back deeper to complete a wave (II). So, just be mindful that there is a possibility we could see another high before a deeper pull back occurs. It is also possible that if this occurs, that we won't get a deeper pull back, and BTC simply commences a melt up in wave (III). Insomuch as anything is possible, this could occur, so be mindful of it, however it is not our primary expectation. Our primary expectation is that Bitcoin will pull back to the $6,600 - $4,500 region to complete a wave (II) before taking off in a parabolic fashion to ultimately conclude the next big move to the $70,000 region.
In conclusion, as I have said before, Bitcoin and other cryptocurrencies are the proverbial raw nerve investment sector. I have no doubt investors will continue to make derogatory remarks about our expectations all the way up to the $70,000 region, all the time while we are making extraordinary profits, and they are not. That is perfectly fine with those of us who have chosen to covet the cryptocurrency and block technology and capitalize on its superior performance potential. I will also say that this sector is extremely volatile. It is not necessary to bet the farm on price movements in Bitcoin and other cryptocurrencies. A small investment will fluctuate by enormous amounts, but over the long term can provide extraordinary profits. We are expecting a move in BTC back to the $6,600 - $4,500 region, followed by a continuation higher, with an eventual price target of $70,000 in this portion of the long term price cycle.