Is Bitcoin still a good buy?
|Spoiler alert: the answer is yes. So, the question is whether buying BTC now is too late. Although many factors go into this decision, such as expected hold time, expected gains, risk, etc., we don’t want to buy uninformed, when risk is high, etc., and this is where our preferred method of analyses, the Elliott Wave Principle (EWP), comes into play.
We have been tracking an “Ending Diagonal” price structure from the August 5th low that moves higher. In our last update, we expected Bitcoin to “ideally reach $74.8-78.4K, possibly as high as $82K on any unforeseeable wave extensions”. Fast forward, and Bitcoin is now trading at almost $90K. Thus, as we stated last, “… we continue to prefer the ED wave count until proven otherwise.” Well, we have been proven otherwise and have adjusted the ED pattern to a non-overlapping impulse pattern, which also moves higher. Even better. See Figure 1 below.
Figure 1. Our preferred detailed, short-term EWP count for Bitcoin.
Based on the impulse pattern, BTC should wrap up the orange W-3 of the grey W-iii of the green W-5 of the red W-iii. The ideal target for the orange W-3 is $106,500 to 109,220. That zone represents the blue (nano-degree) 300% Fibonacci extension and the orange (micro-degree) 261.80% Fib extension, which are common 5th and 3rd wave extensions, respectively. From there, the orange W-4 can start, etc.
Building on previous work, we know Bitcoin has a four-year cycle consisting of four phases. See Figure 2 below. Based on a standard 200% Fib-extension of the red W-i, measured from the red W-ii low, we had projected an upside target of ~$106K.
Figure 2. Our preferred detailed, long-term EWP count for Bitcoin, with its four-phase cycle.
We can now adjust our upside target as Bitcoin’s current rally extends. We should expect BTC to target the 300-400% extension at $216-445K. Once the red W-iii completes around $119-147K, we can better determine where BTC will top at the end of next year.
In conclusion, the EWP count from the short- to the long-term strongly suggests that Bitcoin is still a good buy on any pullback. We expect at least $216K to be reached, possibly as high as $445K, contingent on holding above the late-October low.
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