Transcription
Hey everybody, Kimosabi here, giving you a Sunday night update on wave structure and what's going on here.
Uh, very nice move down over the, uh, well, on the Sunday session to open up the week. This can be positioning taking place for a potential reversal tomorrow. But first, we need, uh, some kind of higher high, higher low structure going on here. But I do see a pattern like right off the rip. And ultimately, it should lead to lower prices.
But for now, matching this with this leg up here. And what we're getting now appears to be this same leg here appear to be that. So, I wouldn't be surprised if this pushes back up to the daily open, sells off to 50% of that, and then pushes up to grab this upper liquidity up here before moving down. So, the wave pattern slash structure would just be this meshing this. So, then one more leg down, 70K-ish or something like that. Probably break under the 70K. You've got that 74,000 liquidity to take. So there's your three-wave move in the middle. Match that leg with that leg and then one more down sometime in December.
We can also take this as an Elliot wave structure here. I am in linear scale, not in log scale, but you have 1, 2, 3, 4, 5 and an ABC pullback for wave two and your wave three expected to come to the 1.618. Didn't quite reach there. So maybe this stabs down and takes that 1.618 and gives you the wave three. Uh, but you do have a structure here that's acceptable as a five-wave structure in wave three. And often you'll see this in Elliot wave theory where you will have a one, two, wave three is slightly larger than wave one, very bouncy wave four, and then an extension in wave five in the third wave. So that works really good to say, "Hey, there's five waves there." Um, it counts fairly well, even though you have an overlap right there. I think Bitcoin's been doing that lately, but it counts all right. And your retrace where where you came to right here is a 382 retrace or very close to it. Missed it by a little bit. And ultimately your target should be the 0.5 retrace at 98. And if price makes it up to 98, that limits the downside a little more if all of these legs are going to match.
Or maybe it just goes down from here. You are still very much in a downtrend. You have a lower low. There's your lower low, lower high. This would be where you would look for a lower high. So, this could this could be ready to go down. But based upon pattern and retracements of this move down, kind of got to expect this liquidity to be taken up at 97 to 98,000.
But just for the heck of it, let's let's measure from the last high. We actually do have a almost a 50% retrace of that leg down. So that can be your wave three. This is your wave four happening right here. And you still got wave five to go down for wave three. Um, I think the the matching legs here say that you could look for a potential move up maybe to hit that trend line as I was suggesting in the last video or on slice when I updated on slice. Um, I was kind of looking for a potential for a move down here and if the move shot back up real quick to look for a push up, but there was there was no bounce. Now you're getting some bounce here. You do have liquidity being taken. Maybe you stab down for this next liquidity. Any break below that wick, you're tackling the next wick down and likely to come to 85, almost exactly. Kind of abrupt selling happening here. You didn't really take liquidity up here. So this abrupt selling I think is to engineer, um, liquidity above to make it look very, very bearish. Take liquidity and then pass it off up there before ultimately continuing down.
You don't have any daily divergence happening just yet. We'll bring it to the daily chart here and bring up the RSI. The RSI did have a breakout of its bearish trend and likely to backtest this trend line. How far down does it go? It probably goes down here. But expect this to come down and backtest this and then give you bullish divergence. And you may need two or three drives of bullish divergence before you get a bounce. I think I think many are looking for a bounce that bought up above 100K looking for the bounce to exit, uh, because they feel bare market is coming and that bounce may come, but it probably comes from lower if I had to guess. Um, just based on this wave pattern and the legs matching and stuff, it it just looks like it's going lower and likely tackling this liquidity. Certainly any break below that low right there, you're certainly tackling there because looking left, you've taken all liquidity. This wick low went all the way underneath all of these wicks. So your your next liquidity is that 74.
And while we have the RSI here on the daily, you can notice that all of these lows ended up having divergence, even multiple drives of divergence before you decided to get a a move up. Even here, the last low here, three drives down, two drives of bullish divergence. You may be experiencing something similar here. Um, nothing really bullish about this chart because you are still making lower lows and lower highs. I think you would have an argument to say maybe you're bullish if you close a daily above 92 to 93,000. Then you do have a slightly higher high, but your higher low comes in at liquidity down here at like 82,000. And then maybe you you get the bullish divergence happening and then maybe you get a bounce. Um, this is definitely being painted as looking like it's going down. Uh, but well, we'll see.
Take that off there. And I want to take up the cyclic lines looking at our low that happened in August of last year and taking our low that happened in April and just talking this being a cycle of some sorts. It's like 200 days. Um, but you could see after that happens, large rise, large rise. So maybe we're waiting for that. I mean, there's only two iterations here. So, it's it's nothing to uh, to bet the farm on, but it may be an area or a time to look for your low. And here coming in at around the 9th of December, if that is coming on the 9th of December, kind of would expect this to be more bearish to to complete this move down. I said it doesn't look like it's completed just yet. So maybe this goes down right away. Already getting a couple hundred bounce here, but we'll see how the daily closes. If your daily closes something like this wick here, it's likely to come up for liquidity and maybe backtest that trend line. Um, still ultimately bearish. But if it doesn't, then this move is actually completed right there already. And now you're in this declining phase to do this. Maybe you you just come down, up, and hit down on that 9th of December or something like that.
In order to see the the move, you would measure this and get the 1 to 1 Fibonacci extension of that, which should lead you down to sub 70,000. I think it's fairly impressive to have a almost a 50% cut. If if price does get down there by December 9th, you'd be cutting yourself in half from 125 down to 60, you know, 65,000 or something like that. That would be cutting the price in half in a matter of two months. That would certainly get everybody pretty bearish, I would I would expect. Um, but you do have liquidity up here, liquidity up here, then you're going to be building liquidity up here. So if price doesn't come up here and grab this liquidity and ultimately goes down there, watch for a higher high, higher low coming out of there to then take this liquidity and maybe higher.
We'll zoom it down here to the 30-minute chart. Getting down to the nitty-gritty, you have all these equal lows here that were set there for a reason. Price came up and looks like a Bart Simpson, right back down. Taking liquidity has everybody max bearish, but this is how the daily and weekly ends up opening. Usually, if anybody else noticed this, but usually when you get a daily candle close, it's almost always a just sell, just sell immediately. Um, seems that the whoever is running this market is just opening up shorts to right after the daily open, just pushing price down and then throughout the day it rebounds somewhat. But you have to look for your setups to get that rebound or just short the daily open when it opens. I don't tend to do that, but it seems like it would it would work and have to backtest that over the past few months and just say, hey, open up a short right when the daily opens.
So, watch for a higher high up at like 88,000. Then you'd be getting higher than there and then you're likely to get a bounce. You may be tackling this next though, this little 85,000 liquidity. I think you've got a few, probably some bullish divergence happening, but you're majorly oversold. Yeah, look at that. You're you're way down there, 21. So, let this come back up to the 50 and find support at like the 28 and maybe you'll have the bullish divergence you're looking for. Or if this thing starts an uptrend here, closes a higher high, try to buy the higher low and then look to take profits around the daily open because you're likely to have supply come in there again. As it was support before, you're probably going to flip it into resistance initially. Um, in the pattern that I'm kind of watching. So that this should come back up to the daily open, push down halfway or something like that, and then push up and break liquidity.
So bringing it full circle here on the 4-hour chart, it's saying that hey, will this match this leg match here? I would suggest sometime this week you will have a sell setup that takes price lower. Ultimately, you'd be looking in that box at the 1:1 to the 1272 Fibonacci extension, somewhere around here between 94 and 98,000. So, if that is the case, let's get a projection for the completion of the leg down. Which would be, say, it takes all the liquidity up there all the way to 98. Then your 1:1 extension gets you down to 74,961 to 68,67. That would be your your buy zone. And this low here is just under, it's about 745. I don't remember the exact low, but say that comes down there and just takes out that liquidity. That may be that may be the low.
We could put this on log scale and that changes the targets. You're talking just barely breaking the current low. I don't think that would look quite right. Probably bring your target from 98 down to 94 and say to look for the 77 to the 72 range for a buy setup for something different to happen to complete this leg down. And like I said, look for December 9th, just based upon the quote unquote cycles with two iterations.
Another thing that I'm looking at is on the daily chart is these tops also, that top also, that bottom, and the date that they happen and thinking it should have relevance in the future. So this is basically your top and that could have topped the cycle, which says, hey, look for one year, one year from this date exactly, you should have a cycle low. It's kind of the way the charts have been playing out. So, don't want to argue with that. Um, but what I am looking at is this peak right there was the 17th of December and price has basically spent a whole year chopping around. So, what if, just a thought, what if this was your bare market? And here's your bare market. And this pattern's going to match with an ABC up there. And this actually gets up higher than I'm expecting this week. Uh, gets up to 99 or 100K maybe. And then this low does hold. And then you have this pattern repeating right here somehow up to there and then chopped down into December 17th, giving you a ying and yang high and low and it's just matching the pattern. And then we repeat that leg straight up. What do you need for that to happen? Well, you need a higher high. Need a higher high, higher low situation going on. So you're not likely to have that. Your real higher high comes in at 112 or 111. Maybe it's 109 or something like that. You get a daily candle close, higher high. You look for the higher low, but you don't have any bullish divergence on the RSI yet. The way you normally have at previous lows that we've seen. Not necessary, but it certainly is helpful. But yeah, if you do match this leg up, then you buy the higher low. That's that's a likely target. Somewhere around 98, even above, anywhere between 98 and 100,000. If you make that leg up there, even if it comes up in three waves, I don't care. You will have a leg that moves up that doesn't match any of these other legs, which tells me to watch for a change in behavior because it's doing something different. So a change in behavior can be seen as many things. Uh, right now your behavior is this much up, basically, and that much down. You know, you're down they're bigger than their ups. So that is the current behavior. But if you get a behavioral change by having a larger up than those previous moves up, that's also a change in behavior to give you some kind of insight to say, hey, maybe something different's happening. Maybe you are breaking out of this trend line and you backtest and there you go. So watching December 9th, December 17th is another date and maybe it just drizzles off into the end of the year. And who knows if these patterns want to complete and this wants to eventually move down to here. Then maybe you just get this this triangle formation here that looks like a wave four like it's going to break down and then you get this back up to 122 or so and then this repeats and then your your bare market essentially is there to next year. So, you might have still another year of downside or sideways or chop or whatever. And maybe you go much, much lower, but ultimately this this is a high. This is a higher low. This is a higher high. This is a roundabout where you'd find a higher low. The wicks can go wherever they want, but the closing basis needs to remain higher high, higher low. So, out of this, if this is going to be a higher low, it needs to confirm itself as a higher low on the weekly or monthly chart. And it does that by making a higher high on the daily. So higher high, higher low, and then you can move up. Right now, there's no real reason to get super leveraged here. Uh, unless you're trading the patterns and you know your invalidations, but the chart is not yet bullish. I would even see if this if this decides to come down here and make a lower low, then this is your this is your uh bare market invalidation. As soon as you make a higher high above that, this would be your buy setup right there. So, be patient, know your trade setups, take them, stop losses, keep them stops small, keep the stops tight, as tight as you can, and have a good night.