-
Bitcoin seems to be highly correlated to the stock market. Many of the waves are the same and the US30 also is showing a completed five wave pattern in a wave one (or A) reversal.
-
Our Elliott Wave outlook indicates a downtrend continuation on the EUR/USD and the end of a bearish five wave pattern on both BTC/USD and the US30 stock market.
-
EUR/USD failed to make a bearish break below the bear flag pattern. But now price action has made a bearish bounce at the 61.8% Fib is and retesting the support again.
Our weekly analysis on Elliott Waves takes a close look at the EUR/USD, the Bitcoin crypto currency, and the US30 stock market.
EUR/USD retraces and bounces at 61.8% Fib resistance
The EUR/USD failed to make a bearish breakout below the bear flag chart pattern in the past 2 weeks. But now price action has made a bearish bounce at the 61.8% Fibonacci level and is retesting the support line again.
-
This time around, a bearish breakout seems likely. A daily candle close below the support trend line (green) would confirm the break.
-
The main target is the round level at 1.10. The bearish price swing could complete a wave 5 within wave 5 of wave C.
-
An unexpected bullish break above the 61.8% Fibonacci resistance would place this bear flag pattern on hold whereas a strong bullish move invalidates it (red circle).
-
The EUR/USD seems to be building an ABC (gray) pattern within a larger triangle pattern.
BTC/USD finished bearish wave A
The Bitcoin crypto pair (BTC/USD) has seen some hard hits in its price during recent weeks. Can it fall further?
-
The short answer is yes. The uptrend seems over and a strong and long bearish correction is expected according to our current Elliott Wave analysis.
-
However, a 5 wave bearish pattern seems to be completed. The bullish pinbar candlestick pattern could confirm a bullish reversal.
-
If price action does complete the bearish price swing, then price action has completed 5 waves (pink) in wave A (gray).
-
The next price swing should be an ABC (pink) pattern in the wave B (gray). After the ABC is completed, the wave C (gray) down should resume.
-
The main resistance levels of the wave B (gray) correspond to the 38.2% and 50% Fibonacci levels.
US30 also shows five bearish waves
Bitcoin seems to be highly correlated to the stock market. Many of the waves are the same and the US30 also is showing a completed 5 wave pattern in a wave 1 (or A) reversal:
-
5 waves (pink) seem completed in wave 1 (gray) or wave A.
-
A bullish ABC (pink) is expected in wave B (gray).
-
A bearish bounce at the resistance should end wave 2 and start wave C (gray).
-
A break below the bottom indicates a continued downtrend whereas a break above the resistance could indicate bullish strength.
The analysis has been done with the indicators and template from the SWAT method simple wave analysis and trading. For more daily technical and wave analysis and updates, sign-up to our newsletter.
Elite CurrenSea Training Program(s) should not be treated as a recommendation or a suggestion to buy or sell any security or the suitability of any investment strategy for Student. The purchase, sale, or advice regarding any security, other financial instrument or system can only be performed by a licensed Industry representative; such as, but not limited to a Broker/Dealer, Introducing Broker, FCM and/or Registered Investment Advisor. Neither Elite CurrenSea nor its representatives are licensed to make such advisements. Electronic active trading (trading) may put your capital at risk, hence all trading decisions are made at your own risk. Furthermore, trading may also involve a high volume & frequency of trading activity. Each trade generates a commission and the total daily commission on such a high volume of trading can be considerable. Trading accounts should be considered speculative in nature with the objective being to generate short-term profits. This activity may result in the loss of more than 100% of an investment, which is the sole responsibility of the client. Any trader should realise the operation of a margin account under various market conditions and review his or her investment objectives, financial resources and risk tolerances to determine whether margin trading is appropriate for them. The increased leverage which margin provides may heighten risk substantially, including the risk of loss in excess of 100% of an investment.
Recommended Content
Editors’ Picks
EUR/USD treads water just above 1.0400 post-US data
Another sign of the good health of the US economy came in response to firm flash US Manufacturing and Services PMIs, which in turn reinforced further the already strong performance of the US Dollar, relegating EUR/USD to the 1.0400 neighbourhood on Friday.
GBP/USD remains depressed near 1.2520 on stronger Dollar
Poor results from the UK docket kept the British pound on the back foot on Thursday, hovering around the low-1.2500s in a context of generalized weakness in the risk-linked galaxy vs. another outstanding day in the Greenback.
Gold keeps the bid bias unchanged near $2,700
Persistent safe haven demand continues to prop up the march north in Gold prices so far on Friday, hitting new two-week tops past the key $2,700 mark per troy ounce despite extra strength in the Greenback and mixed US yields.
Geopolitics back on the radar
Rising tensions between Russia and Ukraine caused renewed unease in the markets this week. Putin signed an amendment to Russian nuclear doctrine, which allows Russia to use nuclear weapons for retaliating against strikes carried out with conventional weapons.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.