(Elliott Wave Forecast Team)
One of the well-known facts of the market is correlations between instruments. However, that rule does not apply every time in every instrument. Here at Elliott Wave Forecast, we call a first-degree correlation when 2 instruments move together according to how they are related. For example, everyone knows that if the USDX is weak then its counterparts like Gold or Cryptocurrencies need to move in the opposite direction. The opposite is called second-dimension correlation. It occurs when the 2 correlated instruments do not move tick by tick the same and deviate from the rule of first-degree correlation. In this article, we will see how we were able to forecast the wave (5) in LTCUSD while other cryptos remained weak.
LTCUSD 1 hour New York update 12.23.22
Litecoin was expected to start the next leg higher in wave (5) while above 61.15. While other related instruments were expected to remain weak. LTCUSD made the move higher and is currently within wave 3 of (5). Let’s have a look at how it looks today.
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LTC 1.10.23 1 hour Asia update
Now Litecoin is extending higher in wave ((iii)) of 3. Pullback soon in wave ((iv)) before ((v)) higher to end wave 3 in red. More upside should continue thereafter. As wave 4 in red pullback should find support for wave 5 of (5) to end a larger degree cycle.
If you have a look at other related instruments the view looks different. This is because LTCUSD has been reacting in a second-dimension correlation within its larger degree cycle.
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