A Merry Bitcoin Christmas

• Posted by Greg Harmon
• on December 25th, 2013

Since it is a Holiday in the US and all the markets are closed it is time to revisit Bitcoin ($BTCUSD) for all the trading junkies that need a fix. When I took a peek at the technicals on Thanksgiving I decided to Let Bitcoin Pass Me By while noting the Elliott Wave pattern playing out. Traders say that securities and currencies without fundamentals are the best one’s to trade technically and Bitcoin fits that bill well. Since Thanksgiving it has held true to form and added another pivot

to the chart. The weekly chart above (log scale) is updated for the most recent activity. Most notably Wave III of Wave V has ended and it is working on Wave IV. There are a couple of things that can be said about the new wave forming. First, since it is the second corrective wave it is likely to be different from Wave II. As Wave II was sideways it is expected that Wave IV will be down, and it is so far. Second, it has limits as to how far it can go down. It can not go below the top of Wave I, so look at 148.70 as a downside limit. It may be in Wave A of Wave IV still and have much lower to go. But it has also already retraced over 61.8% of Wave III, so it could be that the current weekly candle is the start of Wave V of Wave V. If that turns out to be the case then look for an upside target that could be as long as Wave III, to 1587.30 but could be as small as 100 points. We will need to see the subwave action to get a better assessment. The important point is though that the current trend is lower and Elliott Wave principles suggest that it could go much lower still.

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