Market Overview: Bitcoin

Bitcoin

Context and Transition

Bitcoin spent eight months in a wide trading range during 2024
Break above the range high completed a textbook measured move
Early 2025 printed a double-top plus a powerful bear surprise bar that flipped bias to “always in short”
Given that bear bar’s strength, a second leg lower or sideways looked likely
Bears failed to extend the decline:
- Big lower tail before the surprise bar exposed selling exhaustion
- Price quickly re-entered the double-top zone and closed the breakout gap
- Bears never seized clear control of the market
The 12‑month moving average overlapped the 2024 breakout zone, creating a confluence support shelf

Shift Back to Long

Q1 2025 saw a 30% drop from Q4 2024 highs, triggering institutional buy programs during re‑allocation
A textbook High‑3 pattern formed, marking a technical reversal setup
A strong bull bar closed above the 3‑month moving average and flipped bias to “always in long”
Drawdown fully recovered; price entered a firm bull micro‑channel and printed a cup‑and‑handle
Markets resist abrupt regime shifts; rallying straight from “always in short” to bull carries statistical edge
First pullbacks in a fresh bull leg almost never reverse; odds favored continuation
A tight sideways‑to‑down pause ended with a High‑2 buy signal two weeks ago

High‑2 Mechanics

High‑2 acted as a legitimate entry trigger
Follow‑through lacked vigor, but bulls held ground against expected Q2 institutional sellers
Buying one tick above the previous all‑time high offered a higher‑probability entry than High‑2
Bulls targeted a clear bull breakout

Bull Breakout and Targets

Pre‑breakout probabilities stood at:
- 60% chance to reach $120 000 before tagging June lows
- 40% chance to hit $130 000 before testing those lows
Last week’s price cleared the previous all‑time high with a strong breakout bar
Bulls tested $123 000 this week as anticipated
Breakouts often pause with a small second leg sideways to up
Expected profit‑taking around $120 000–$123 000 sparked the pullback from the monthly measured move

Bad Follow‑Through

What Now

The market cycle remains in a tight bull channel
A bull micro‑channel now shows two bull bars and two dojis, raising pullback odds over coming weeks
Two open gaps—body gap and breakout gap—favor bulls while they remain unfilled
Bears need a clear bear bar next week to increase their chances of testing closing gaps and eventually reach June lows

Trading Range

Bull Breakout

Last week’s breakout looked strong for bulls, implying a high probability of second‑leg gains
Monday’s price action hit the measured‑move target based on the prior range’s height

Measured Move Is Resistance

Rally stalled at both the daily measured‑move target and a coinciding monthly target
That reaction aligns with typical profit‑taking at major measured moves

Time for Bulls to Assess Strength

Bulls reached their target on Monday and now gauge market response
If bears fail to shift bias to “always in short” this week, bulls will re-enter positions
Renewed buying would treat sideways trading as a simple pullback inside a bull channel

Scenarios

A tight trading range balances odds between bulls and bears
A 50% retracement without quick recovery would lower odds of a strong bull trend
Bulls would then adopt a buy‑low/sell‑high approach, reducing chances of hitting weekly targets
Bears must flip bias to “always in short” by:
- Filling bearish gaps and closing current bull gaps
- Closing and consolidating below the 50% pullback level
- Triggering a bear breakout via strong bars or a series of bears
- Closing below $112 000 to confirm downward control

Conclusion

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