The current market situation is discussed by the practicing trader and founder of the project Crypto Shaman Vadim Shovkun.
Bitcoin has spent 26 days in a $43,000–$50,000 range and is near an upside breakout. The authenticity of this move warrants assessment.
First, it is prudent to examine the Ethereum chart. Over the previous two days, the price rose by about 20%. At the moment, this cryptocurrency is the market’s driver, pulling Bitcoin along.
The latest daily bars are robust, full-bodied, but the daily bar with a large green spread was accompanied by decreasing volumes (compared with the previous day). An impulsive exit from the red zone of the selling base suggests a locally strong buyer, but the absence of volume calls the move’s authenticity into question.
Meanwhile, on the weekly ETH/USDT chart, a pronounced drop in volume after the May dump has persisted for three months.
From these observations, there is a high risk of returning to the range. A sharp move back into this range would break the long setup. A fall below the $3,230 level would open the possibility of medium-term shorts.
Over the past month, Bitcoin has been confined to two ranges, the latter at $46,800–$50,100. Within it, buyer strength has risen at three attack angles to the upside, while two downside angles weaken gradually. On the daily timeframe, volumes are relatively low. RSI divergence remains.
At the moment, a small pullback is planned, followed by a breakout of the two-week range. The nature of the breakout and pullback will determine the future of the leading cryptocurrency. The $50,500 mark is the turning point. A sharp return into the two-week range forms the UT pattern, characterized by stop-hunt activity with potential movement to $38,000. If this scenario plays out, one could consider medium-term shorts.
If the breakout forms on good volume, and the four-hour chart shows a sequence of solid spreads and a smooth pullback, then this breakout can be described as JOC+BTC (Jump over Creek + Back To Creek), which would in turn allow considering long positions.
