BTC Warns of High-Level Correction Risk, HYPE Short-Term Pullback Won't Change Long-Term Bull Trend | Guest Analysis

Last week, we used Chan Theory to analyze BTC's structure, and the market's movements were largely within expectations. This week, let's switch perspectives and look at it through Elliott Wave Theory. The conclusion turns out to be clearer and also more worth being vigilant about: This rebound that started in July may already be nearing its end.

When the market is moving smoothly, the easiest thing to overlook is the question of "is this a rebound or a reversal?" This week we'll lay out the answer clearly, and also take a look at HYPE, which just hit a new high and is currently pulling back, to see whether its footing at this step is solid.

Summary of This Week's Core Trading Views:

• BTC daily-level trend structure analysis (see Part One for details)

• BTC this week's market forecast and medium/short-term trading strategies (see Part Two for details) 

• HYPE daily-level trend structure analysis (see Part Three for details)

• HYPE this week's market forecast and short-term trading strategies (see Part Four for details)

1. Bitcoin Daily-Level Trend Structure Analysis

In the previous weekly review, this column introduced the Chan Theory analysis framework to systematically break down and provide forward-looking forecasts for BTC's daily-level trend structure since its rebound from the July 1 low, especially since September: the price has been consolidating at high levels on the daily chart since September 3, and will simultaneously form a second upward pivot. From actual price action, this pivot is still in the process of being formed, and the overall market rhythm is basically consistent with the previously anticipated direction.

This week we will switch to the Elliott Wave Theory analysis framework to conduct an in-depth analysis of the current daily-level trend structure.

Figure 1: Bitcoin Daily Candlestick Chart

1. Overall Structural Pattern

As shown in Figure 1, since the rebound from the July 1 low of $57,820, the price has initially formed a clear a→e five-wave upward structure. It is currently in the e-wave phase.

2. Five-Wave Structure Breakdown

①. Wave a (Rebound Wave): July 1 to July 21

•  Rebound range: $57,820 → $66,955

•  Duration: 21 trading days

•  Maximum gain within range: 15.8%

②. Wave b (Correction Wave): July 21 to August 1

•  Pullback range: $66,955 → $62,268

•  Correction duration: 11 trading days

•  Technical characteristic: The retracement precisely tested the 50% Fibonacci level of Wave a's gain

③. Wave c (Rebound Wave): August 1 to September 3

•  Rebound range: $62,268 → $82,285

•  Duration: 33 trading days

•  Maximum gain within range: 32.15%, approximately 2.2 times Wave a's gain

④. Wave d (Correction Wave): September 3 to September 15

•  Pullback range: $82,285 → $74,955

•  Correction duration: 12 trading days

•  Technical characteristic: The retracement was 37% of Wave c's gain, and the correction duration was basically symmetric with Wave b

⑤. Wave e (Potential Rebound Wave): September 15 to present

•  Starting point: $74,955

•  Has been running for 12 trading days (ongoing)

•  Current maximum gain within range: 16.6%

3. In-Depth Analysis

①. After a short-term consecutive rally, multiple technical indicators have entered deeply overbought territory.

②. As shown in Figure 1, the self-built "Momentum Quantification Model" is currently in a top-side钝化 (blunting) state (this signal is a necessary precondition for forming a bearish divergence); the "Spread Trading Model" has also continuously triggered top warning signals.

③. The price has approached the key resistance zone of $88,000–$90,500.

④. Although the price has reclaimed the yearly line (364-day moving average, approximately $80,500), it has not yet completed a pullback confirmation; moreover, the yearly line is still pointing downward.

⑤. If the subsequent rebound fails to break above the September 21 high of $87,399, or effectively breaks below the $80,500–$82,500 support zone, then it is confirmed that the e-wave rebound ended at $87,399.

⑤. In summary: The probability of the e-wave terminating at this key resistance zone is extremely high. The current market is still a daily-level oversold rebound, and a trend reversal has not yet been established.

2. Bitcoin This Week's Market Forecast and Trading Strategy

1. BTC This Week's Market Forecast

Core view this week: BTC is at the end of the e-wave; focus on its termination point to confirm the completion of the five-wave structure. 

2. Core Resistance Levels

   • First resistance zone: $88,000 area (previous important level)  

   • Second resistance zone: $91,500–$93,000 area (previous important resistance zone)

3. Core Support Levels

   • First support: near $82,500 (previous important support level)  

   • Second support: $73,500–$75,000 area (previous important support level)       

   • Third support: $67,300–$69,100 area (previous important support level)                                     

4. This Week's Trading Strategy (Excluding Impact of Breaking News)

①. Medium-term strategy:

Figure 2: Bitcoin _ Daily Candlestick Chart: (Position Monitoring Model)

Position Monitoring Model: As shown in Figure 2, the price has broken through the "Long-Short Channel," but has not yet entered the pullback confirmation phase. Therefore, the current medium-term strategy is primarily to stay in cash and observe.

②. Short-term strategy: Use 30% of position, set stop-loss points, and look for "spread" opportunities based on support and resistance levels. (Use 30-minute/60-minute as the operating timeframe).

③. In short-term trading, to dynamically adapt to complex market developments, we have prepared A/B contingency plans in advance.

• Plan A: Go short with the trend after effective breakdown.

   • Entry: If the downward momentum continues after this week's open. When the price effectively breaks below the $80,500–$82,500 support zone, a short position of approximately 30% can be established.

   • Risk control: Set an initial stop-loss.

   • Exit: When the correction reaches important support levels and combines with model signals, positions can be closed in batches to take profit.

• Plan B: Light short position test at strong resistance zone.

   • Entry: If the price rises to the $88,000–$90,500 area, shows a clear bearish reversal pattern under pressure, and the quantitative model simultaneously issues a top signal, a short position of approximately 30% can be established.

   • Risk control: Set an initial stop-loss.

   • Exit: When the correction reaches important support levels and combines with model signals, positions can be closed in batches to take profit.

3. HYPE Daily-Level Trend Structure Analysis

Figure 3: HYPE Daily Candlestick Chart

1. Market Validation of Last Week's HYPE Analysis

As shown in Figure 3, last week's weekly review clearly pointed out: if the upward segment (16-17) confirms termination, the market will shift into a high-level consolidation pattern. The actual market movements were basically consistent with last week's analysis.

2. Current Trend Analysis

①. On September 22, the price hit an all-time high of $101.93, confirming that the long-term bullish pattern remains unchanged and the uptrend continues;

②. The current trend can be defined as the pullback confirmation phase after breaking above the previous high of $89.69. The support near this level constitutes a short-term "watershed." If the support holds, the consolidation and upward movement will continue; otherwise, the correction period will be extended.

③. If the price effectively breaks below the key support near $89.69, there is a possibility of further decline to the support near $85, or even seeking support near $77 again.

4. HYPE This Week's Market Forecast and Short-Term Trading Strategy

1. HYPE This Week's Market Forecast

①. Core Resistance Levels:

• First resistance: near $102

• Second resistance: near $110

②. Core Support Levels:

• First support: near $90

• Second support: $84–$85 area

• Third support: $76–$77 area

③. Core View This Week:

Focus on the final outcome of the bull-bear battle around the key support level of $90. Combined with the self-built quantitative model indicators, the probability of the price continuing in a high-level consolidation pattern is relatively high.

2. HYPE This Week's Short-Term Trading Strategy

①. If it stabilizes at key support, try a light long position.

If the price falls to near the $89.69 support level and shows a stabilization pattern, and the quantitative model simultaneously issues a bottom confirmation signal, a long position of no more than 30% can be established in batches. Be sure to set a stop-loss and execute it strictly.

②. If it stabilizes in the secondary support zone, try a light long position.

If the $89.69 support fails. Wait for the price to continue adjusting to the $77–$85 area and show stabilization signals, and the quantitative model simultaneously issues a bottom confirmation signal, a long position of no more than 30% can be established. Be sure to set a stop-loss and execute it strictly.

5. Special Notes

 1. When opening a position: Immediately set an initial stop-loss.

 2. When profit reaches 1%: Move the stop-loss to the entry cost (break-even point) to ensure capital safety.

 3. When profit reaches 2%: Move the stop-loss to the 1% profit level.

 4. Continuous tracking: For every additional 1% profit, move the stop-loss up by 1% accordingly, dynamically protecting and locking in gains.

Financial markets are constantly changing, and all market analysis and trading strategies require dynamic adjustment. All views, analytical models, and trading strategies in this article are derived from personal technical analysis and are solely for personal trading journal purposes. They do not constitute any investment advice or basis for action. Markets carry risk; invest with caution, and do not make decisions based on this article.