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12 Market Cycle
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Topic starter
01/02/2024 2:09 pm
Hello, everyone. I am new to the BTC and have a question on the market cycle - video 12A. Al mentions that, in a broad bull channel, "as long as the pullback stays above roughly 2/3 of the height of the prior rally (i.e. I interpret this as a 33% retracement), there is a 60% probability is that the market is going higher, otherwise it drops to 50%." Is this broad channel pullback probability rule based only on the height of the previous leg, or on the overall trend move so far? Your help and insights are greatly appreciated!!!
04/02/2024 3:51 pm
The probability would be based on the previous leg that I highlighted in the green box. The closer the red shaded pullback gets to the previous low the higher the probability gets for it to break that low and create a LL.
Only after the most recent HHs and HLs are broken do you start to consider the larger legs to the left. Breaking below the previous L is the first of several steps in the transition from Bull Channel to Trading Range.
