The situation in the cryptocurrency market remains unfavorable for trading and has not changed over time. Despite the continued downward trend and a complete lack of signs of its shift to a bullish one, the corrective rise has been ongoing for nearly three months. The nearest bearish FVG on Bitcoin's upward path has elicited only a very weak market reaction. Thus, the first important area of POI for sales has essentially been ignored (but the pattern is not yet invalidated). In recent days, we have observed some semblance of a downward reversal, but the movements remain extremely weak, and Bitcoin now has a bullish FVG at the bottom that may create an obstacle to continued downward movement. Overall, Bitcoin has been stuck in the $80,000-$81,000 range. Therefore, we continue to consider the market to be in a state of corrective pause.
In the meantime, SkyBridge Capital founder Anthony Scaramucci stated that Bitcoin develops (in the long term) according to an S-curve. This curve signifies a slow movement at first, followed by rapid acceleration. At the end of the curve, the asset should be fully adopted by the masses. Scaramucci compared Bitcoin to the stocks of Amazon and Microsoft, finding similarities in the development of these instruments. In the early years of their existence, these companies grew slowly but then experienced explosive growth, and their products began to be used widely. According to Scaramucci, Bitcoin is currently in the middle of its S-curve.
The expert also noted that fiat money loses its appeal each year due to inflation and central bank actions. Bitcoin, on the other hand, is an improved form of money, decentralized and independent of the will of corporations, governments, or central banks. According to Scaramucci, Bitcoin cannot be devalued, and an increasing number of companies and individuals are beginning to use this "digital gold."
Overall Picture of BTC/USD on 1D
On the daily timeframe, Bitcoin continues to form a downward trend and a correction against it. The trend structure is identified as downward, and the CHOCH line remains at the level of $97,900. Only above this level can it be said that the downward trend has ended. As there are no signs of a trend change to bullish, we believe that the decline will resume sooner or later. On the daily timeframe, the nearest area of POI for new sell transactions is in the range of $79,500 - $81,100. This area has been tested twice, and the price reaction to it has been very weak. Consequently, it is likely that this pattern will be invalidated, and Bitcoin may continue to rise to the next FVG in the area of $84,900 - $88,800. The liquidity pool below the trend line remains a price target. A small bullish FVG has also been formed. A reaction to it could signal the continuation of the correction and allow traders to open small long positions.
Overall Picture of BTC/USD on 4H
On the 4-hour timeframe, Bitcoin continues its upward movement, which remains a correction. The CHOCH line of the current upward structure is at $74,950; a consolidation below this level will signal a potential break in the trend. This could be a very important signal for the market regarding a trend change. The completion of the upward trend on the 4-hour timeframe may serve as a starting point for a new round of the trend on the daily timeframe. There are still no fundamental grounds for Bitcoin's long-term strengthening. Spot interest is very weak.
Trading Recommendations for BTC/USD:
Bitcoin continues to form a complete downward trend and a correction against it. We continue to expect a decline, targeting $57,500 (the 61.8% Fibonacci level of the three-year upward trend), and there are currently no signs of a trend reversal. Among the POI areas currently, the nearest bearish FVG on the daily timeframe is in the range of $79,300 - $81,200. It has not yet been completely invalidated, but may be invalidated soon. In this case, the area of POI for sales will be $84,900-$88,800 (the next bearish FVG). The decline targets remain below the $60,000 level. For long positions, the only bullish FVG on the daily timeframe can be used, but it should be remembered that any rise in cryptocurrency now is inherently a correction.
Explanations for the Illustrations:
CHOCH – Change of Trend Structure.
Liquidity – Stop Loss, pending orders that market makers use to build their positions.
FVG – Fair Value Gap. Price moves through these areas very quickly, indicating a complete absence of one side in the market. Subsequently, the price tends to return and react to such areas in continuation of the main trend.
IFVG – Inverted Fair Value Gap. After returning to such an area, the price does not react to it; it breaks impulsively and then tests it from the other side.
OB – Order Block. The candle on which a market maker opened a position with the aim of gathering liquidity to form their position in the opposite direction.
