Great Risk To Reward Medium Term Trade on BTC (Short)
It looks like Bitcoin could be forming an ending fifth wave diagonal that signals a potential sharp reversal to the downside ahead. For this to be the case, the price needs to push up to the local highs at around 12400 before dropping sharply.
If the price pushes up once more, I will look for bearish divergence on the RSI and MACD histogram as extra confirmation to get in (bearish divergence = higher highs on price but lower highs on the indicator).
The stop loss for this trade is placed where the 3rd wave within the final 5th wave becomes the shortest. Elliott Wave Theory states that the 3rd wave cannot be the shortest, so if the price exceeds 13005, then the 3rd of the 5th will be the shortest and this count will be invalidated.
Entry zone for the short - between 12630 and 12340
Stop loss - 13005
Take profit - between 11620 and 11015
This is not financial advice and only intended for learning purposes. I am not responsible for any losses that may be incurred.
If the price pushes up once more, I will look for bearish divergence on the RSI and MACD histogram as extra confirmation to get in (bearish divergence = higher highs on price but lower highs on the indicator).
The stop loss for this trade is placed where the 3rd wave within the final 5th wave becomes the shortest. Elliott Wave Theory states that the 3rd wave cannot be the shortest, so if the price exceeds 13005, then the 3rd of the 5th will be the shortest and this count will be invalidated.
Entry zone for the short - between 12630 and 12340
Stop loss - 13005
Take profit - between 11620 and 11015
This is not financial advice and only intended for learning purposes. I am not responsible for any losses that may be incurred.
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