BTC relief rally

Happy Monday gang!

It's bizarre to see green on Mondays but that's exactly what we have. Big daddy is up almost 5% over the last 12 hours starting around 5:30 this morning (eastern) and continuing to threaten upwards action. If you remember from last week, there was a possibility of the inverse head & shoulders pattern formation signalling a shift in the trend and it appears far more likely today than it did yesterday that this pattern will be confirmed.

I know it's tempting to get excited about movement upwards after the last 7 months, but remember that we likely still have a bull trap in the chamber. Frankly, I'd like to get it out of the way and put the bottom in, so ideally this iH&S will fuel the rally to the upper bound of the falling wedge. If this is the case, the following is a possible scenario:

Price could rally over the course of the next two weeks to the upper bounds of the falling wedge and horizontal resistance in the vicinity of 7400. I'm not sure this would quite qualify as the kind of gut-wrenching trap that I have in mind, but in the spirit of price action following the "path of most frustration," some traders are surely convinced that a retrace to the 786 fib level would be the end of the bleeding. I think not.

If you recall my previous articles, I believe that 786 will offer temporary support before the price crashes through that level down approximately 40% to 3500. This will be the bottom and signal the beginning of the next true bull run and a nationwide crash in demand for Ramen (possible short). I have this slated for mid-September based on a comparison of price action to the 2013 market cycle (see last Friday's article) and bearish divergence in the stoch.

With respect to timing, my prediction is playing out quite nicely with enough time allotted for a bounce off the falling wedge line of resistance and coming back down to the bottom of the wedge around the 786 fib level at ~5600. The price will then break sharply downward out of the wedge, margin-calling every jabroni from here to Tim Buk Tu (at least they can use Bitmex) and culminating in a capitulation bottom on the exact day that Virginia Tech beats Florida State 27-21 in Tallahassee on a last second scoop-and-score.

Another possible wrinkle to this could be a short squeeze induced fake-out emergence from the wedge to the 618 fib level at 8500 which would certainly qualify in my book as a bull trap. Stay vigilant.

All in all, I think we're getting close to the bottom. However, I believe the uptrend will be slow to start and won't heat up until Q1 of 2019. I've got my eyes on the bitcoin ETF as a catalyst. It's tough to say exactly how that will play out, but if an ETF becomes a popular addition to passive investments, there could be quite a rise in demand for BTC. Approximately 500 billion per year is passively invested in the US alone.

"I have no timetable for these predictions, but just in case, keep them around and look at them in 5 to 10 weeks. Let us hope and pray that I am wrong on all accounts. If so, I will be very pleased."