BCH-ANALYSIS-MICRO WAVE
BCHUSDis a buy. I will use Fibonacci, Elliot Wave Theory for this analysis.
I am using the 1 hour timeframe.
I'm seeing a MICRO Wave formation along with an ABC correction.
The Micro Wave is highlighted by the teal numbers.
This wave passes all of Elliot's Wave Laws.
1.Wave 2 can never exceed the start of Wave 1 (i.e., $488.20)
Key:The point to remember here is Wave 2 can never go below the bottom of wave 1. Always place a stop just under the beginning of Wave 1.
If this is a true Wave formation we need to make sure this level holds.
2.Wave 3 can never be the shortest impulse wave
3.Wave 4 can never overlap Wave 1 (i.e., cross into the same price area) except within a diagonal triangle
Be aware that there is a tendency for two of the three impulses to be equal, i.e. 100% of each other. So if Wave 3 is an extension, there is a bright chance for Wave 5 to equal wave 1 in distance.
Impulse Wave 3 was 5.79%
Impulse Wave 5 was 5.60%
Fibonacci Ratios:
There are perhaps seven or eight main ratios that seem to appear again and again in most charts. These are 23.6%, 38.2%, 50%, 61.8%, 100%, 123.6%, 138.2% and 161.8%.
Wave 2 typically finishes at either the 50% or 61.8% retracement of Wave 1. Occasionally, we also get a 70.7% retracement, and a bit more frequently a full 100% retracement of Wave
The upcoming wave 3 will travel a minimum distance equal to 100% of Wave 1. If the third wave started from 61.8% or 100% retracement level, you will look for the third wave to tend to move a distance of 161.8% of wave 1. Any third wave that does not travel more than 161.8% of Wave 1 is considered to be a ‘normal’ Wave 3.
We are now looking for the start of Wave 3...
When a normal third wave is completed, wave 4 typically corrects the third wave by 38.2%.
I have place a Fib Time Zone from the beginning and end of Wave 1. Wave 2 usually finishes near the 2nd Fibonacci Time Zone.
Correction:
ZIGZAG
This is the simplest form of correction, (A, B and C) where Wave A is made up of five waves and Wave B has 3 internal waves. Wave C is always made up of 5 waves in any correction, irrespective of the category.
Wave A:
1HR:
See Related idea for more charts and analysis.
Will update.
-AB
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