Bitcoin recently rallied from 24756 on 6.15.2023 to 31458 on 6.23.2023. This equates to a 27% rally within a span of one week. In today’s video blog, we will look at the structure of this rally and also look at the structure of the entire move up from the November 2022 low. There are five swings up from November 2022 low which could be a bullish Elliott wave nest or a diagonal structure coming to an end. We will explain which one we think it is and what the next move in BTCUSD is most likely to be.
BTCUSD 5 Swings Sequence
The chart below the move up from November 2022 low to current levels is clearly in 5 swings. This means it’s either a double nest when we are ending wave (( i )) of 3 of ( 3) or we are ending wave 5 of a diagonal and about to complete the cycle from November 2022 low. In case of a double nest, after completing the cycle from June 15, 2023, low, there should be 3 waves pull back to correct the cycle from June 15, 2023, low and acceleration higher in the form of wave (( iii )) of 3 of ( 3). In case of a diagonal, once cycle from the June 15, 2023 low ends, we should see a much deeper and rather stronger pullback in 3, 7 or 11 swings to correct the entire cycle from November 2022 low before the rally resumes. More upside should happen in both cases but the only question is how deep the next pullback could be and which cycle would it correct i.e. 15 June 2023 low or November 2022 low.
BTCUSD Double Elliott Wave Nest
We know that in a diagonal or a regular impulse, there should be momentum (RSI) divergence between wave 3 and wave 5. In a regular impulse, wave 3 will have the highest momentum most of the time unless wave 1 is extended. In a diagonal structure, on the other hand, the highest momentum could either be in wave 1 or wave 3 but there should always be momentum (RSI) divergence between wave 3 and 5. If we look at the RSI indicator at the bottom of the chart below, we can see that RSI reading at current levels is higher than the RSI reading at the red 1 peak. This means the current rally from June 15, 2023, low can’t be wave 5 of a diagonal and hence the most likely path should be that of a double nest when we are ending wave (( i )) of 3 of ( 3 ) and we are close to ending wave (( i )) after which there should be a pullback to correct the cycle from June 15, 2023, low. This pullback should offer a buying opportunity in 3, 7, or 11 swings as far as a pivot on June 15, 2023, the low remains are intact.
BTCUSD Short-term Elliott Wave Analysis 6.27.2023
