This was a response to this chart above. Can be found here.
My main interest has been highlighted in bold
@eYou1 - First and foremost, I very much appreciate the distinctive, point-by-point analysis you have laid out on the Geo. This is very much how I would have expanded the analysis, so it makes it very easy to follow, despite the complexity that would otherwise be forming to anyone's eyes.
Second, I agree with your analysis, that by the sole dependence on price analysis (aided by the overlaid pattern analysis), one might expect a retracement from recent highs to Point-3 (BLACK), which appears to have already occurred. So, one might tend to expect further rallying to occur from current levels.
However, the Predictive/Forecasting Model remains expectantly bearish - This Model does not use price, volume, news or fundamentals, and is purely driven by quantitative data manifested as fractals. The current outcome of the Model suggests a higher probability of a down-turn than an up-turn.
Now, mind you that we are resting only in the realm of probabilities, and that price or not, Model or not, all remains a matter of weighing possibilities against probabilities, which is really all that I can go by, as neither my directional opinion nor my bias will ever count in my analyses and forecasts - What comes out of the Model is what is, until proven otherwise.
Over the years, I have had the chance to test my opinion and bias against the Model by taking live trades since I felt that the market direction and strength (predictive analysis) and extent (forecast) appeared so ridiculously far off to me that it could not possibly "get there". However, I have lost too many times at this second-guessing that I decided to simply and mechanically report and put my faith in it - not something I recommend to anyone, as I would expect that any good trader would do his/her own due diligence. But for the sake of having to compare what I think and what the Model "says", I have taken the quiet position and waited for further confirmations outside of the Model, even if this meant to come late into the trade.
In terms of confirmations OUTSIDE of the Model, I recommend looking at structural analysis (i.e.: looking at breaking of recent/prior highs and lows). In addition, a "total" analysis of Elliott Wave would be a good idea, since the current price action might cause myopia as we might risk to look too closely at the wave counts.
My position in those terms has remained bearish on the basis that the impulse that carved the highest historical high (across the year 2013), has been followed by what appears to be a protracted consolidation (large a-b-c across the year 2014) as a first A-Wave, followed by a B-Wave across the year 2015 into recent June 2016 (expressed by your points 2-3-4-5'' in BLACK). So, expectedly,
a conclusive C-Wave remains afoot to the DOWN-side, even if speculative, as there is yet no other price action that exposes a clear impulse development to the UP-side for now, and no clear counter-argument to the current 3-3-3 pattern still unfolding. In any case, this remains a very challenging and interest object of curiosity for the Predictive/Forecasting Model, as Bitstamp has not followed the surest path, and the temptation to follow a reasonable geometric pathway has been too often proven wrong by the Model, retrospectively. So, as I remain bound to second-guess the Model (by virtue of having to question the Model in a constant exercise of its refinement), I would love to see your geometry-based scenario unfold in your favor, and see the Model proven wrong, so that it can be "tweaked" to its smallest detail.
In the 4-Hour chart I posted recently, I marked 666.02 as a possible ultimate level, based on a reciprocal ab=cd symmetry, against 645.00 as a probable target to the upside. I would chance that IF price were to transgress BOTH of these levels and continue above the 775.00 level, then the Model would stand little to no chance to remain credible as far as this bearish scenario goes.
Time is a good teller, and that is the story I will have to wait for patiently.
Much appreciate sharing your thoughts and detailing that analysis.
Keep posting and always assume that the Model is wrong - This remains the only way to improve on a system and keep all subjectivity out of the trades.
Have a very safe week-end,
Regards,
David Alcindor
