Breakout Setups and Positioning

A question was PMd to me and I felt it important to share: 

Hi Ryan, when u have time, please explain this to me on on your XBTUSD bulletin board "To be reliable we need to retrace .618 of the way to the top. Then retrace correctively. Do I wait for that to go long? No. But I do wait for that to trade in size. " Which top would that be for XBTUSD to calculate the . 618 retrace ?

1) The .618 retrace refers to the peak to trough of this correction represented by the orange line. It is just known in EW that unless you take that level out in 5 waves you don't have a high probability bottom. That is 11,774.

2) Do I wait to go long?

Again, I scale in and out of corrections. This rough scaling is represented by the arrows. The first arrow into the peak I knew we'd start some form of correctiom. I took some of my longs off, and at some point I started putting shorts on. I never went net short. It's a bull market. As we went lower in the first leg, I"d take some hedges off. In the leg up into what I'm now calling X, It was not clearly impulsive. I increased hedges again. Slowly. And, now as we've gone lower, I'm at it again. I'm not waiting for a perfect bottom. 

Now, if we get a clear 5up to at least 11,775 or at least close, that I can't doubt, and then pull back in three waves to support wherever that is defined by the peak I will be aggressive on the long side. But until then being long is warranted being aggressive is not. 

XBTUSD - Naked - Jul-17 1716 PM (6 hour)
XBTUSD - Naked - Jul-17 1716 PM (6 hour)
Ryan Wilday hosts the Cryptocurrency Trading service on ElliottWaveTrader.net.