Market Overview: Bitcoin
Bitcoin is up nearly 10% in May, with just one trading day remaining before the monthly close, at the time of writing. This follows a strong April and reinforces the current bullish tone. June marks the final month of Q2, which makes price behavior this month especially important. A strong close could influence positioning for the second half of the year.
Bitcoin
The Monthly chart of Bitcoin
April ended with an outside up bar. Price responded by rallying again in May. The monthly candlestick traded above the previous higher high, surging from a retest of the prior breakout level. This move brought critical developments:
- Price surged from the breakout point until a higher high without trading at or below the breakout point level
- This is visible on main charts, such as Coinbase Exchange Bitcoin Spot chart and from the Ishares Bitcoin (IBIT) ETF
- Therefore, the breakout point level remains protected, indicating bulls are still in control
At the upper wick of May’s candle, a long tail suggests that sellers engaged near resistance. This tells you the area remains contested. But the case is weak for the bears:
- Bulls still control the structure
- Few professionals want to short into bull’s strength
There are two clear measured move targets to watch:
- $120,000 projection based on the 2021–2022 drawdown
- $140,000 projection based on the current pullback
Also notable: the 12-month EMA is now above $80,000, this is certainly an average to watch, since it is the breakeven price of many Bitcoin holders.
The Weekly chart of Bitcoin
A large cup formation is visible on the weekly chart. The right side of the cup developed through a six-week bull micro channel. Currently, the weekly bar is an inside bar. The same is true for the IBIT ETF (after this week’s close).
Inside bars are often early-stage pullbacks. In this context, they may act as the beginning of a handle, which could complete a Cup and Handle pattern. This is important for one reason:
- Traders need tighter formations to define risk
- A handle provides a place to place a reasonable stop near entry
- Without it, the setup lacks a risk management structure
The current environment supports this setup:
- The prior bull trend is strong
- The cup depth is not too deep
If the handle forms, traders can act with more confidence. They’ll know quickly if the trade works, and the expected payoff can be worth the attempt. Historically, this pattern gives:
- About a 40% chance of achieving a 2:1 reward-to-risk move
2021 vs 2025 – Cup and Handle Differences
Many beginners compare this pattern to 2021. On the surface, the similarities exist. But key differences show why this analogy can be misleading. Get an in depth breakdown here.
Pre-Cup Rally
- 2021: Bitcoin surged +5x from COVID lows—an extreme run-up
- 2025: Price moved from $74K to $108K, a modest and steady climb
Drawdown Depth
- 2021: Cup was followed by a 50% crash
- 2025: Pullback was only 30%, and it reversed fast
Bear Breakout Behavior
- 2021: Aggressive selloff with weak bounce
- 2025: Mild selling, followed by strong reversal
Leg Structure
- 2021: First leg was slow, second was explosive
- 2025: First leg already reclaimed all losses with momentum
Sentiment
- 2021: Heavy retail engagement, meme culture, “to the moon” talk
- 2025: Calm tone, low retail presence, more measured participation
Ask yourself: are conditions in 2025 pointing to a similar crash? Or are traders reacting based on memory, not current structure?
What Traders Need to Enter
Currently, the market lacks a clean breakout mode (BOM) structure. The inside bar is a start, but one or two more sideways bars are needed.
The Bulls will not want to see a deep pullback. A 10–15% retracement from highs is acceptable, but deeper may weaken the setup.
A few more sideways bars would offer:
- Clear entry and stop points
- Confirmation that buyers are still active near highs
- A chance for professional bulls to re-enter or scale up
Bearish Outlook
There’s little activity from bears on this timeframe. Most participants are long-term holders. They may choose to:
- Sell portions to take profit
- Hedge positions using options
This is not fear-driven, it’s positioning. Bears are not aggressive. They see limited downside, and the price structure supports that.
Where might bears aim if they engage?
- $65,000 to $75,000 would be reasonable pullback targets
A wide, sideways trading range is more likely than a full-blown crash
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