Tradzar
Bitcoin Price Analysis Powered by AI
Post-Capitulation BTC: Relief Rally Fades Under 71.5k — Short the Rejection Zone
Market regime snapshot (Daily + Intraday)
- Current price: 70,609
- Context: BTC has undergone a sharp multi-day drawdown from the late-Jan consolidation (~89–90k) into a capitulation low on 2026-02-05 (low ~62,354; close ~62,702), followed by a violent rebound to 70,555 (02-06 close), a pullback to 69,282 (02-07 close), and another push back to 70,609 (latest).
- This is classic post-capitulation “dead-cat bounce / relief rally” behavior: strong mean-reversion upward, but still inside a broader lower-high / lower-low structure from mid-Jan.
1) Price action & trend structure
Daily structure (swing analysis)
- Major swing high: ~97,860 (2026-01-14 high)
- Breakdown leg: 95k → 88k (01-20 close) → 84k (01-29) → 78.6k (01-31) → 73k (02-04) → 62.7k capitulation (02-05 close).
- Current position vs breakdown: 70.6k is still well below the prior broken supports (75–79k zone and 84–86k zone). Trend remains bearish on the daily despite the bounce.
Intraday structure (last ~24h hourly)
- Local low area formed around 68.8–69.1k early 02-08.
- Strong impulsive push to 71.4–71.5k (hourly highs cluster at ~71,455).
- Subsequent drift/rotation back to ~70.6k.
- This creates a near-term ascending structure (higher low → higher high) but currently retesting/holding mid-range.
Implication: Near-term bias mildly bullish (relief continuation possible), but the larger trend is bearish and overhead supply is heavy.
2) Support/Resistance mapping (horizontal + swing)
Key supports
- 70,000–69,800: psychological + intraday congestion; many hourly closes rotate around here.
- 69,300–68,900: intraday base region (multiple touches); losing this likely invites a slide to mid/low 67s.
- 67,400: prior day low area (02-07 low ~67,364).
- 62,700–62,300: capitulation floor (02-05 close/low). Major “line in the sand.”
Key resistances
- 71,450–71,500: session high; clear short-term ceiling.
- 73,000–73,200: prior daily close zone (02-04 close ~73,020) = first meaningful daily supply.
- 75,500–76,000: breakdown continuation zone (02-03 close ~75,634 and subsequent selloff).
Implication: Upside is capped in layers; first test is 71.5k, then 73k. Downside acceleration triggers under ~69k.
3) Volatility & range diagnostics
True range / shock behavior (daily)
- 02-05 candle: massive range (high ~73,162, low ~62,354) with extreme volume (125B) → capitulation signature.
- 02-06 rebound: range still large (60,074–71,681) with huge volume (114B) → short covering + bargain demand.
- 02-07, 02-08: ranges compressing and volume declining → post-shock consolidation.
Implication: After a volatility shock, markets often retest levels and chop before choosing direction. 24h expectation: range-trade with slightly upward drift, unless 69k breaks.
4) Moving averages (regime inference)
(Exact MA values aren’t computed here, but directionality is inferable from the sequence.)
- From mid-Jan to early-Feb, price dropped from ~95k to low 60s, so short/medium MAs (10/20/50D) are very likely sloping down.
- Current price (~70.6k) is likely below 50D and possibly below 20D → bearish higher-timeframe structure.
Implication: Rallies are more likely to be sold into at resistance; trend-following systems prefer shorting rebounds rather than buying.
5) Momentum (RSI-style reasoning)
- The collapse into 02-05 is consistent with oversold momentum.
- The rebound into 02-06/02-08 suggests RSI rebounding from oversold toward neutral.
- On hourly: strong push 69k → 71.4k indicates momentum burst, but the fade back to 70.6k suggests momentum cooling.
Implication: The “easy” long (oversold bounce) has partially played out; risk/reward improves for short entries near resistance rather than chasing longs mid-range.
6) Volume & effort vs result
- Highest volumes coincided with the selloff low (02-05) and rebound (02-06) → transfer of coins.
- Subsequent days show lower volume and smaller ranges → market is waiting.
Implication: With no fresh expansion volume on the breakout above 71.5k, the move is vulnerable to rejection.
7) Pattern recognition
Daily: bear trend + relief rally
- Structure resembles bear flag / bear pennant developing after the steep drop, with price consolidating between ~69k and ~71.5k.
Hourly: range with resistance cap
- Multiple probes toward ~71.1–71.5k; failure to sustain above suggests supply absorption.
Implication: Highest probability in next 24h is mean reversion within 69k–71.5k, with a slight skew down unless 71.5k breaks and holds.
8) 24-hour directional forecast (probabilistic)
Base case (most likely):
- Chop/rotation between 69,300 and 71,500, with sellers defending 71.5k.
Downside scenario (if 69k breaks on momentum):
- Quick move toward 67,400 (02-07 low), potentially an intraday spike lower.
Upside scenario (if 71.5k breaks and holds with impulse):
- Extension toward 73,000–73,200 (first daily supply).
Given the dominant daily downtrend + overhead resistance stack, the risk-adjusted edge favors a short position into resistance rather than a long in the middle of the range.
Trade Plan (next 24h)
Decision: Sell (Short Position)
Rationale:
- Higher-timeframe trend remains bearish (series of lower lows since mid-Jan).
- Current price is in a post-crash consolidation under layered resistances.
- Best asymmetric entry is to short closer to resistance (71.4–71.6k zone) rather than shorting breakdown lows.
Optimal open (entry)
- Open Price (Sell): 71,450
- This aligns with the clearly defined intraday resistance ceiling (~71,455 high). If price revisits that area, it’s a higher-quality short entry.
Take-profit (close)
- Close Price (Buy to cover): 69,300
- This targets the base of the current consolidation / support band, capturing the most probable rotation move within the range.
(If price never revisits 71,450, the setup is “missed” rather than forcing a low-quality mid-range entry.)
Note: This is technical-analysis-based and does not account for sudden news/liquidity events; BTC can gap/impulse beyond technical levels.