Long-term trend
In yesterday’s analysis, we mentioned that Bitcoin might hit the $39,100 support level and might rebound. In fact, Bitcoin did bottom out near that price, which was in line with our expectations.
However, despite the current signs of a halt in the decline, the market is increasingly calling for bargain hunting. From the perspective of the long-term chart, the most likely trend in the future is a period of consolidation, followed by another decline to achieve our target of $36,200. The second is a direct waterfall decline.
It is important to realize that a new round of upward breakout is unlikely in the long term. Therefore, investors should be wary of those who call for buying at the bottom and avoid blindly following the trend.
Medium-term trend
On the medium-term chart, we can more clearly observe the performance of the price after it hit the support level of $39,100. This price level has a combination similar to a piercing pattern. Although the bulls ultimately failed to counterattack the bears, if the current K-line can close with a small positive line, it will further prove that the buying power is indeed increasing.
Considering the previous period of consolidation, which is characterized by sideways movement instead of rising, with small amplitude and short cycle. Therefore, in the medium-term trend, we need to focus on the suppression ability of the $40,333 resistance level. If this position cannot effectively prevent the bulls from counterattacking, then the next target will be the bull-bear line.
Short-term trend
On the micro chart, we can see that last night's trend ended the decline with a small W bottom, and prompted the market to enter the long-short conversion stage. This is consistent with the logic of our video yesterday reminding everyone to pay attention to the short-term structure and prepare a trading strategy.
It is worth noting that before the market entered the long-short conversion rhythm, the market had already risen rapidly and reached the profit target, which shows that the market already has a certain rebound momentum.
Next, we need to wait patiently for the completion of the long-short conversion. Once this process is completed, the market will once again present clear structural trading opportunities.
