Elliott Wave Theory is based on the concept, that a main trend consists of 5 waves, which is followed by a 3-wave correction structure. The basics are derived from the psychological behaviour of the traders. If interested, please do the research for more details.
The exact levels and target prices are usually defined by Fibonacci levels and technical channels, but in order to keep it simple I haven't highlighted them on the chart.
The waves are provided with the following basic code structure. Further variations appear based on the level of investigation.
Trend move: 1-2-3-4-5
Correction move: A-B-C
Regarding the current situation of BTCUSD, in my opinion we are currently in the 5th wave of a medium term upward trend. The strongest confirmation of this theory is the third wave, which is a dynamic upward movement (3), followed by fast and heavy correction wave (4). This combination is the easiest to recognise, as usually the correction move is fast ind it should not close below the previous local high created by the first upward element of the wave structure. In this case, (4) did not close below (1). Same happened on a smaller levels as well, when the (iv) correction waves did not close below (i).
If our statement is legit, we are currently approaching a new high in the (5) wave. The fifth wave of a trend movement usually goes higher than the third wave (3). To be exact, it should go at least to the level of the third wave, or even further. Depending on the structure of the third wave, the target price for the fifth wave is determined by the channel built from the local lows of (2) and (4). If the third wave is an extended one (which is our case), the target price should sit somewhere on the upper side of the channel defined by (2) and (4) from below, and (1) from above.
Defining the target price is not my favourite part, as it is more determined in ranges, rather than exact levels. On the other hand, the Elliott wave theory certainly provides guidance on the waves that should be expected. Therefore we arrived to the conclusion, that a correction move will arrive sometimes soon, just based on technical analysis. The theory is valid, if we reach a new high above 4900 and below the upper side of the channel described above. When we reach that end of the (5) wave, it is very likely that a fast and heavy correction move will start targeting the levels around 3000 again. The exact levels are again hard to determine, as it is not even certain whether we already had a (iii) and (iv) or not. On the other hand, the (A)-(B)-(C) correction move should not reach below the local high of (1), because if it does, that is a signal for a change in the longer term trend. If it remains above 3000, a new first wave can begin, and so on...
The Elliott Wave Theory is best when it can also be matched with expected fundamental changes in the future. One valid explanation for the above movement, is a profit taking action following the Hype around the current hardforks on BTC.
Once this story is finished, or even before, we can reach the end of the (5) wave, expecting that the people are thinking one step further.
This is just a possible scenario, treat it as all technical analysis should be treated. Time will tell ;)