What's Next for Cryptos:

Note this is a repost of my article on Medium:

In my last article, ‘Did the Crypto Bubble Pop’, I explained that I don’t like the word ‘bubble’. Instead, I base my trading and pricing decisions on price levels defined by the Elliott Wave Principle, using Fibonacci-based price levels that correspond to my view on the wave pattern. I also use those levels to refine, confirm, or invalidate my view.

In that article I said that I believed the market would hold the recent lows we had seen, most of which were struck on January 17th. Instead, support levels for those ‘setups’ broke down, and a further slide in prices followed.

The price levels we call using Elliott Wave are important. Rarely does the market just break them and move down slowly. Prices usually move fast through price levels.

Yesterday, February 2nd, we saw our first sign of the ‘flush’. This is the term we use to express the acceleration in velocity that is required to scare weak holders out of their positions. When complete, the flush usually results in a strong reaction when buyers finally come in. At 4am on the 2nd we saw this reaction.

Now the question is whether this ‘bid’ will lead to an end to this correction. That remains unconfirmed. According to Elliott Wave Theory, a correction is made up of three waves labeled ABC. And the C wave usually ends in five waves. If it ends in three, we call the whole pattern WXY. This pattern is rare in most markets, but not in cryptocurrency.

If we get the orthodox five-wave C, we are in 4 up right now. While my subscribers and I made some purchases at the bottom of wave three, we retained ammo to buy if the market gives us one more low.

If instead we see a continuation to above $14,000 without one more low, we’ll consider that an important bottom is in place and will start to look higher, at the $30,000 range, with a chance for $60,000+. Just as mentioned in the last post, we’ll need to watch for another B wave.

Here are two charts of Bitcoin as examples, close up and slightly zoomed out.

This pattern can be seen in most of the cryptos we’re watching closely. Verge (XVG), Reddcoin (RDD), Bitshares (BTS) and Steem are some of our top picks in the next rally, based on Fibonacci targets.

We hold core positions in such large-caps as Bitcoin, Ether, Ripple, and Lumen, just to name a few.

Once we have a firm bottom in place, we expect the next rally to last for roughly six weeks to three months, depending on velocity, or whether something else shows up to lengthen or shorten the rally. ![BTCUSD - Primary Analysis - Feb-03 2034 PM (1 hour).png]