The two types of flats set to unravel in BTC | The Gold Forecast

The two types of flats set to unravel in BTC

March 11, 2021 - 7:06pm

 by Joseph M. Wagner II

An ABC flat correction differs from a zigzag in that the waveform traces out a 3-3-5 waveform. In general ABC flat corrections retrace less than zigzags.
The more powerful the underlying trend, the shorter the flat correction tends to be.

Simple Flat

  • Waves C tends towards 100% the length of wave A.
  • A flat correction wave will usually target the 50% retracement level of the previous move.

If a flat A, B, C correction is realized, we had already reached our wave B’s conclusion when we matched the previous record high at approximately $57,800. If this scenario plays out, we will see a correction from current pricing and not exceed yesterday’s high. We also can expect the final C wave lower would take us to approximately $44,000.

 

Expanded Flat

  •  Wave C tends towards 162% the length of wave A.
  • A flat correction wave will usually target the 50% retracement level of the previous move.

The main difference between the expanded or irregular flat and the simple flat is in the expanded flat is that the end of wave B extends past wave A’s starting point. This would mean in the case of BTC that the B wave higher has not yet concluded, and we will make a new record high before entering the final corrective C wave.

In either of these types of corrections, they usually retrace 50% of the previous move (Wave 5), in this case around $43,000. It already came close to this in our A wave and will be our target for Wave C’s conclusion.

In these flat corrections, the length of each wave (A, B, C) is more or less equal in size, which is what we have seen so far. This also hints that a conclusion of the C wave will likely be around $44,000.

What this means for traders depends on price action over the next two trading days. We will either be heading down for one final corrective leg or headed to a new all-time high.

I find the possibility of a new record high intriguing, and as such, if we get a clear break above $58,000, we may not be involved in a flat top correction but rather a triangle. If this plays out, then traders should buy the breakout past $58,000 with targets of $64,000. We must watch the next two days of trading carefully and act according to the guidelines laid out in this article.

*Any questions? Feel free to ask me at JosephWagner007@gmail.com *

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