On the Bitcoin chart (4-hour timeframe), a bearish triangle is clearly forming above the price area, awaiting retesting. This zone is roughly limited by the 111,800 and 116,200 levels. The BTCUSD pair passed through the area with several strong, nearly pullback-free bullish candles.
Following this breakout, Bitcoin began consolidating above $116,200 within the mentioned descending triangle. Such patterns are typically considered reversal formations. When they occur, financial instruments usually make a corrective move toward the previously tested level—in this case, the 111,800 mark.
Keep in mind that it may take a few more days for the triangle to form. At the same time, the reversal pattern of this triangle could transform into another one, such as a head and shoulders, without losing its reversal nature. In other words, the current triangle could potentially become the left shoulder, after which the market would form the head at a higher price level than the current local maximum of $123,217.
A breakdown below $116,160 per coin would serve as a sell signal for BTCUSD. Reaching the target of $111,800 could take several weeks, as under this scenario, the price may not retest with strong bearish candles and could instead slowly drift down toward the intended level.
The overall recommendation is to sell BTCUSD.
Profits should be taken at the level of 111,800. A Stop Loss could be set at 124,700.
The volume of the opened position should be calculated so that the potential loss (protected by a Stop Loss order) does not exceed 1% of your deposit. If your account balance doesn’t allow opening a position of this size, it’s better to avoid entering the market on this signal and wait for other trade options that meet low-risk criteria.
This content is for informational purposes only and is not intended to be investing advice.
