You need a lot of data to confirm the bottom (7500) but if the drop is extremely sharp and the lowest point is touched for a minute before the massive buy orders start coming in giving an increase in and closing the gap completely we can be pretty certain the trend is switching for good (good example is the way we bottomed in February). That is why the recent jump IMO wasn't the trend changer, and we need deeper pullback followed by aggressive purchasing. Then we will enter major wave 3 towards new highs and it should be by definition be more aggressive than the first wave we had since Feb bottom.
I wouldn't short here personally as you never really know how quickly this can turn, but I am ready with buy orders near the projected 7500 area (25% of portfolio - 50% was filled in during the last dip).
As I write this update price is around 8900, and given that there's a big sell off while US market is opened and that it usually takes the price down for about 1000$ we expect to see 7800 level again pretty soon.
Bearish momentum is still here, however buyers are eager to get back in and their patience may run out soon so expect an aggressive buying pattern when we hit the bottom (7500-7600 levels), only that will confirm this was a bottom and that we are ready to go higher for some time. I expect next slow down of the upcoming bullish trend to be at around 12.500 but let's wait and see how this unfolds.
I bought the dip for 25% of portfolio and won't be increasing my position until we see the major bullish wave III confirmed (say breach of 10.000 level).
On hourly time frame, I expect another push down toward 7550 right after reaching 8400-ish level which should mark the end of this correction and a beginning of an upswing which should bring us above recent highs.
*also someone asked why are my chart lines not aligned on the time axis - it is because I wanted to show you precise price levels which are turning points and not try to guess the time when they will be hit as it is less relevant than the price itself. So far all the waves are matching my price turning points spot on.
Take care, keep those stop losses loose and seize the day!
Another thing according to EW theory is that each a-b-c wave is followed by five waves in the opposite direction, therefore since 4th wave (IV) of this correction clearly had a-b-c structure, the final fifth wave (V) had to have five waves within itself. That is why I think we are going to go below 8000 now before we enter a new major bullish wave towards 12.500 levels.
More updates to follow. Stay tuned.
I am already in long positions for the 75% of the portfolio but I have added some minor purchase orders near the bottom, especially on LTC which is projected to bottom at 140 (now that I write that, I realise that the 7000$ BTC may be plausible as LTC/BTC relationship would approve 50:1 ratio).
Remember that for this fall to stop for good we need to see instant and impulsive purchase orders once the critical price is reached.
Medium term, we should enter the third wave, towards at least 12.500 but more on that once we have more data.
Enjoy the weekend, don't stress it, and remember: if you are stressing over it - your position is too large.
In the future, I do think we need to go up, way up (12.500 by May 1st and then 18.000 - sounds crazy right now, I know), BUT I don't see any evidence in price movements that would say we went bullish today so we still need to be on a lookout for the trend switch confirmation.
Interestingly, number of both longs and shorts were at ATH last night and are still pretty high with about 35,7K of longs and 24,7K of shorts.
I don't recommend buy yet, but I do think we are exhausting this down trend.