It’s been a week since we first looked at BTX from a geometric perspective, and determined that the long term trend would likely be up for at least the next few months. We ended the week ~ $25 per bitcoin, higher. So far so good.
At this point, I want to look at the chart from a shorter time-frame and begin to get a finer-tuned picture so that we might get a better idea of how we might time our trades. So let’s look at an 8-hour chart. The rise from May to June was relentless, so we can scarcely avoid using a larger than normal setup. In this case, almost 89 bars.
The arrows highlight obvious places where the chart indicates that it respects the setup. The gray arrow marks the end of the 1st square, where price collapsed. Falling all the way to support at the Gann 8×1 (blue). After recovering somewhat, bitcoin price moved sideways until it cleared the 1st arc pair (pink), where it rallied again, finding resistance at the Gann 3×1 (red). Finally, pricetime found the end of the 2nd square and rallied again (maroon).
This is actually rather bullish for a number of reasons.
- After pricetime works it way through the 2nd arc pair, (which will be ~ 10/22 if price moves sideways through the arc) the 3rd arc pair is significantly higher. As we have seen in earlier charts, significant resistance is not seen until the top of the square at ~ $807, and then the 3rd arc pair which is ~ $1,000.
- If and when price is able to get through the 3rd arc pair (I have no way of knowing if it will do so), the 5th arc pair, the next target, is at new all-time-high levels.
We have seen this resistance at ~ $800 and again at ~ $1,000 on other setups earlier in the week. Interesting that different charts show similar points to watch.
Based on this chart, I will consider the 10/22 time-frame a good time to consider adding to any long positions, unless the chart does something unexpected before then.
The market is fractal. The meaning is that all market movements work together like a Swiss watch. The deeper you dive into it, the parts just keep working together in an almost divine manner. Gann called it “wheels within wheels”. You can envision a picture of the hundreds of wheels in a watch all working together in a miraculous fashion.
Lets look at a smaller setup on this same chart to see if there is any evidence of this phenomenon here.
I left the arrows on the chart from the last setup. Amazingly, you can see that the same arrows happened at precise points in price and time on this entirely different setup. Amazing. Wheels within wheels.
At the pink arrow, pricetime had entered the 1st arc pair, and rallied hard as soon as it exited the pair. At the red arrow price collapsed when it hit the 2nd arc pair, but found support at the top of the 1st square. Price moved sideways until it hit the end of the 2nd square at which point it fell exactly along the 2nd arc of the pair. It recovered quickly and moves sideways along the top of the square until pricetime entered the 3rd arc pair. It rallied to the top of the pair and moved sideways from there.
We can see where 10/22 is on this cart, the place where pricetime will clear the 2nd arc pair of the larger setup if it moves sideways from here.
Speaking for myself, I don’t feel any burning desire to add to any long positions here. I will likely wait until pricetime on the larger setup (the first setup in this column) exits the arc pair it is currently traversing.
Disclaimer: Remember, the author is a trader who is subject to all manner of error in judgement. Do your own research, and be prepared to take full responsibility for your own trades.
Featured image from iStock.