This model works on all of Bitcoin’s recent major pull-backs since 2018, i.e. the 2018 Bear Market, the late 2019 correction and the current 2021 correction (all on the 1W time-frame). I have used the Fibonacci scales extensively both on the horizontal axis (Fib retracement) and the vertical axis (Fib time zones).
** The important of the CCI as phase setter **
In order to determine the start of each Phase, I’ve used the CCI and counted the start of BTC’s Phase from the lowest CCI point after the High before BTC’s peak. In more detail, the CCI High before Bitcoin’s December 2017 Market Peak was on the May 22, 2017 1W candle so the subsequent CCI low on the July 10, 2017 1W candle. Similarly in 2019 the CCI low after the High was on the April 29, 2019 1W candle and on the current 2021 correction the CCI low was on the 07 December 2020 1W candle. All those points are the starting levels of each Phase.
** The Phases **
The first two phases (2018 and 2019) both made bottoms on the 1W MA200 (orange trend-line, the March 2020 even broke it) but as I’ve mentioned on previous analyses, the March 2020 bottom shouldn’t be counted as a technical parameter since the pandemic is a once in 100 years event and should be considered an ‘anomaly’ on our models. Hence I consider as the technical bottom of the 2019 correction the December 16, 2019 candle, which was on the 0.786 Fibonacci retracement level (yellow line), similar to the 2018 bottom, which just happened to have the 0.786 Fib and the 1W MA200 on the same level.
** Current correction **
On the correction BTC is currently in, the 0.786 Fib retracement (from the Dec 07, 2020 starting point) is at 23000. However assuming that there won’t be another outside catalyst/ anomaly to crash Bitcoin lower, and since the 1W MA50 has been hit (and held) two candles ago, there is a certain sequence that shows we may have hit the bottom already. And that is again on the CCI when in the 2019, when it made Lower Lows on the -140.00 level, it was the price bottom and started rising (a rise that should have been extended smoothly if there wasn’t the COVID event).
At the moment the CCI is coming off a similar Lower Lows formation. Is that enough to price in the bottom or you think BTCUSD is ‘destined’ to hit the 0.786 Fibonacci retracement level or even have another catalyst to take us to the 1W MA200?
Feel free to share your work and let me know in the comments section!