WAVESUSD entered the multi-year Buy Zone but can go even lower.Waves (WAVESUSD) has been trading within a long-term Fibonacci Channel. All major Fib retracement levels have played a key role to its trend, forming clear Support and Resistance levels.
This analysis is on the 1W time-frame, where last week, the price entered the Channel's long-term Buy Zone (green area), which has been holding since July 2016. Waves immediately rebounded this week, which is technically justified as this has happened another three times (June 25 2018, November 26 2018 and October 05 2020 1W candles).
However, the late July/ early August 2019 Buy Zone test failed and the price slowly but steadily declined another -60% to reach the Higher Lows (bottom) trend-line of the Fibonacci Channel. As a result, if we don't close back to last week's level, this rebound can be sustainable on the medium-term but only a 1W candle close above the 1W MA100 (green trend-line) seems able to technically reverse the trend to long-term bullish again.
P.S. Notice the near perfect symmetry between Cycles as portrayed by the 1W RSI.
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Wavesusdsignals
WAVESUSD This time is different...Waves (WAVESUSD) has posted an incredible rally ever since the February Low and made yesterday a new All Time High. Needless to say that the $43.00 target we suggested in our most recent idea, was hit:
What we should focus on now is the 1D Golden Cross (when the 1D MA50 crosses above the 1D MA200), which was formed yesterday. This pattern is technically bullish, however the last two formations (January 06 2019 and February 09 2020) marked strong corrections instead of bullish trends. We can argue though that Feb-March 2020 was a 'Black Swan' event, the COVID pandemic crash, which is an irregularity happening outside the technical borders.
During these Golden Cross formations though, the 1W MA50 (red dotted line) was above the price action and in fact rejected the peaks, while in contrast now is below acting as a Support. This is a strong indication that Waves is in a different phase now, being in a new Bull Cycle.
If true, that should draw comparisons with the previous Bull Cycle:
As you see in the wider chart above, the targets of that Bull Rally were first the 1.5 Fibonacci extension and then the 1.786 Fibonacci extension. If history gets repeated in a proportional way, then currently the 1.5 and 2.0 Fib targets are around $80.00 and $126.50 respectively.
Do you think those could be rather conservative estimates for WAVESUSD this time?
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WAVESUSD invalidation to $43.00 if this level breaks.WAVES followed exactly our medium-term plan on the 1W time-frame as it followed the November - December 2018 fractal to our 1W MA50 target and the 0.5 Fibonacci retracement level, as we suggested on the following chart on February 01:
Right now, the long-term cyclical pattern as implied by the sine-waves is intact and in full motion. Watch closely though, as invalidation may not be far away. A 1W candle close above the 0.618 Fibonacci retracement ($22.40 roughly) would invalidate further correction as the 0.618 Fib was never crossed in December 2018. If it does, be prepared to buy the break-out towards initially $43.00.
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WAVESUSD on oversold 1W RSI. Buy signal to the 1W MA50 and $18.5Waves has found support last week on the 1W MA200 (orange trend-line) and this is best illustrated on the 1W time-frame. This helps us get a much better understanding of its long-term Cycles using the Sine Waves tool.
As shown, WAVESUSD has so far had two Cycles that both started with an Accumulation Phase and got completed with a Parabolic Rally to a new All Time High (ATH). The first Cycle entered a Bear Market on an aggressive correction sequence. That sequence broke below the 1D MA50 (blue trend-line) and when the 1W RSI nearly hit the 30.000 oversold level, the price rapidly rebounded back to the 1W MA50.
Currently Waves is at a similar spot with the 1W RSI almost at 30.000, the lowest it has been since early December 2019! It appears it is halfway through its Correction Phase, so technically as long as the 1D MA200 holds, we should be expecting a strong rebound to the 1W MA50. That makes a good medium-term buy opportunity for +100% profit as the price is currently around 9.00 with the 1W MA50 sitting at 18.50.
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WAVESUSD may be ahead of a very strong monthly rallyWaves has been trading inside a Triangle pattern since the May All Time High (ATH). Recently it broke below the 1D MA200 (orange trend-line). The RSI is close to its November 2019 bottom.
We saw the same pattern in late 2017 (June - November). At the time, once WAVESUSD broke below its 1D MA200, it made a bottom and then rallied for 1.5 months to its December 2017 Top (ATH at the time) on the 1.786 Fibonacci extension.
Are you expecting a similar pattern continuation?
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