Market Overview: Bitcoin
- Bitcoin sharply reversed last week from support.
- Strong weekly close printed the first legit bull signal since the 30% drawdown: a High 3 (H3) bull signal.
- This week, the H3 triggered.
- Stock Indexes, meanwhile, showed large bear breakouts on both weekly and daily charts.
- Despite deeper losses in percentage terms, Bitcoin has held better relative to its price structure.
Bitcoin
The Weekly chart of Bitcoin
- Bitcoin traded between $50,000 and $75,000 for most of 2024
- That range broke out through $74,000, targeting the $100,000 level
- The move hit $100,000 by November, extended slightly to $108,000
- $100,000 acted as a profit-taking zone — funds likely trimmed there
- Instead of collapsing, Bitcoin formed a three-month double top
- Neckline near $90,000
- Clean structure, no panic
- Measured correction brought price back near $75,000
That area matters:
- It’s the 2024 range breakout level
- It aligns with the IBIT ETF’s breakaway gap
- Buyers defended the structure — a sign of strength
There’s no evidence of panic selling
- Large holders appear to be rotating, not dumping
- Matches Q1 rebalancing activity
- 30% drop led to trimming — now Q2 bring net inflows (only in rebalance terms) again
Last week’s H3 bull signal:
- Formed off the year’s low
- This week triggered above that high — activating the setup
- IBIT ETF gapped up Monday, then H3’s close held that as support
- Currently, a legit follow-through signal
Is this a high-probability bet?
- No — it’s a reversal trade inside a bear channel
- But reward-to-risk might be 2:1 or better
- Some bulls took the trade for that reason
This week closed as a near-perfect doji
- Because of the gap up, it still counts as a small bull bar
- That qualifies as a good follow through for bulls
The price touched the 26-week EMA again
- Not a close above, but better flirting with it than not reaching it.
We previously noted that April could bring a new bull leg
- Below the Q1 low and at Q1 close, there are buyers
- Technical support and quarterly rebalancing favor bulls
This setup may be compelling for reversal traders
- Trend traders might wait for compression and breakout
- Or they might wait for a clean break to new highs
Bears don’t have a clean setup here
- Selling into support hasn’t worked
- A rally toward $100,000 might offer better risk-reward for structuring short trades
The Daily chart of Bitcoin
Bitcoin remains inside a bear channel since the $108,000 top
The structure doesn’t show strong bear control
- After large bear bars or ETF gap-downs, follow-through has been weak
- Price often moved sideways or bounced
- That’s not strong trending behavior
The price recently hit long-term support
- 200-day simple moving average on IBIT
- 365-day simple moving average on the spot chart
- From there, it bounced decisively
A simple strategy that was suggested in this report played out well
- Buy at the moving average
- 5% stop, 10% target
- Spot chart hit the target last week
- IBIT hit its 10% target this Tuesday
- Stops were never compromised
After reaching targets, price printed a bearish bar
- Could be profit-taking
- Not necessarily a new wave of selling
Bulls are buying dips and making money
- That attracts more dip buyers
- That discourages fresh sellers at current levels
What will bears do next?
- Likely wait for higher prices
- The bear gap still holds trapped longs from earlier in the correction
- Bears may want to sell into that weakness later
Bulls still have a setup on the weekly chart
- That’s where they’ll likely focus
No clear daily pattern to trade right now
- A strong bull breakout might change that perception
- That could be a trade worth taking
Current price action could mean two things:
- The start of accumulation before the broader uptrend resumes
- The beginning of a bull leg inside a wide range between $70,000 and $110,000
- Will price close above the 26-week EMA?
- Can bulls defend $75,000 again if tested?
- Will activity pick up on a break above this week’s highs?
What are you watching for next week? Share your thoughts in the comments! Enjoy the holiday break, and follow sound trading rules!.
Market analysis reports archive
You can access all weekend reports on the Market Analysis page.
