BTC/USD forming a symmetrical triangle as well as XRP/USD

BTC/USD

From Friday’s low at $6238 the price of Bitcoin has spiked up to $7784 yesterday but has quickly pulled back and is currently hovering around $6763.

Looking at the daily chart we can see that the price broke out from the descending triangle which dates from the beginning of February as yesterday’s candle closed above the resistance level at $6740.  The candle closed leaving a massive 13.4% spike from $7788 which is the prior range support now serving as resistance. As today’s candle is still around the yesterday’s candle close levels we are yet to see if this ends as a fakeout.

Zooming into the 4-hour chart we can see that the price action at first broke out off of the symmetrical triangle (dotted lines) on the downside and created a lower leg cluster, indicating that a massive move is coming, but I as many expected a further decline to around $5700 area at first (which is the lowest Bitcoin’s price has been from the start of this bear market) and continue its downward trajectory from there creating a lower low.

 Instead, the price spiked up significantly high enough that I am starting to question my projected lower low scenario. But as the price increase was caused by Tether tampering and not on the real demand and has quickly fallen below the horizontal support level at $6876 and is currently struggling to keep up its upward trajectory I am still hesitant to give up on my call just yet.

Looking at the hourly chart we can see that the price breakout from the symmetrical triangle which can be interpreted as a bull flag is very close.

Technical indicators are not giving us many clues on the direction of a breakout but judging by the price action and the aggressiveness from the seller’s side from yesterday, we are likely going to see the price fall back inside of the descending triangle territory or at least to retest its resistance line for support. If the price decreases back to around $6560-6516 and finds support there, then we could see an increase beyond the horizontal resistance at $6876 in which case the scenario of a descending triangle breakout from the upside would be validated. But if the price enters the territory of the descending triangle and goes lower than the symmetrical triangle’s resistance at around $6356 than I would consider that this was a fakeout.

Elliott Wave Projection 

On the below chart you can see my Elliott Wave projection which actually dates from the beginning of June when the first minor WXY  correction ended and the price fell below the horizontal level at $7792 (now retested with a spike) validating the W wave of a higher degree and as it fell to around $6000 it was clear that we are going to see a few more bounces prolonging the correction with two more waves X and Z. As the Z wave ended I was expecting a down move which is what happened. I anticipated the second corrective wave to interact with the descending triangle’s resistance line and getting rejected once again causing the activation of the third wave which would propel a breakout from the downside.

As the price spiked upward and we are still waiting for a breakout confirmation my projected scenario is still valid until the price exceeds the beginning of the first wave which would be beyond $7368. One can argue that the price did go beyond but until I see a proper candle closed above it I would consider my scenario valid.

XRP/USD

From Friday’s low at $0.384, the price of Ripple has increased by 21.5% measured to the current levels of $0.4647.

Looking at the daily chart we can see that the prior to Bitcoin the price of Ripple has spiked up significantly all the way up to the 0.786 Fibonacci level resembling the Bitcoin’s hourly chart which can provide some insight on what is going to happen next with the price of Bitcoin – a long spike followed by a straight downfall and currently an ascending structure.

As you can see yesterday’s increase also ended as a spike on the daily chart but unlike Bitcoin’s, this one is only 11%

On the 4 hour chart, we can see that the price is below the horizontal support level at $0.474 which now serves as minor resistance. It is interesting that the price interacted with the 0.382 Fibonacci level on yesterday’s spike but the candle closed above the mentioned minor horizontal level. This indicates that the price retests for resistance, gets rejected and the price declines further which is what I believe will happen this time as well.

Zooming into the hourly chart we can see that the price action has formed a symmetrical triangle around the significant horizontal level much like in the case of Bitcoin. Currently, we are seeing that the price action has created two fractals – a steep upward move followed by a correction resulting with a lower high and a higher low. Aggressiveness is shown from both sides so we are yet to see the direction of a breakout.

Elliott Wave Projection 

Looking at the chart below you can see my Elliott Wave count which indicates that even if the price goes further up which is not as likely that I would stay there because this last upswing from 18th of September is only a Y wave of the WXY dating from February. It is still unclear how this last corrective structure I’ve labeled as a minor WXY (blue) will end. Maybe it would be prolonged by two more waves and end up around the levels of the intermediate W wave around $0.93, but according to this projection, the price is heading significantly lower from there as this is a correction in the opposite direction prior to the steep one from the all-time high to $0.66. In that case, a lower low is to $0.15 would be a more than possible scenario or at least to retest the prior one at $0.269.

 

Forex trading with Bitcoin, Ripple, and other cryptos on FXOpen Crypto accounts.

Nikola Lazić

Expertise: Cryptocurrencies, Technical analysis, Elliot waves, Fibonacci Nikola has a bachelor degree in Sociology, which gives him the edge in the financial market, knowing a lot about herd mentality. That is why he uses Elliot wave principles mostly, in combination with Fibonacci levels. He started learning more about financial markets back in 2015 and is now a full-time trader. As an anarcho-capitalist, he fully supports the vision of decentralized future offered by cryptocurrencies, that's why his attention and interest are mostly focused on them. His analysis has been praised by some of the most influential people from the cryptocurrency scene, like Jeff Berwick, the founder of The Dollar Vigilante Newsletter, Vit Jedlicka, the president of Liberland, and other trader colleagues.

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