Short the Bounce: BTC’s Golden Pocket Rejection Sets Up a Fade to 84k

Executive summary

• Thesis for next 24 hours: BTC is in a multi-week downtrend, currently sitting in the 61.8% “golden pocket” retracement of the Nov 21 → Dec 9 advance. Today’s intraday bounce failed beneath layered resistance (87.5–89.0k), followed by heavy sell volume and a liquidity sweep to 84.46k. Hourly momentum has reset (small bullish divergence), so a relief rally into 87.2–87.8k is probable before the prevailing bearish structure reasserts. My base case is to sell the bounce into resistance for a move toward 84.0–83.6k.

Multi-timeframe context

• Weekly: Lower highs/lows since late September (115–126k range top) with a decisive break in October and persistent supply on bounces through November/December. Weekly structure remains bearish; key weekly support sits around 80.7–82k, resistance 90–92k.
• Daily: Trend down since Dec 9 swing high (~94.6k). Price is below the 20/50/200-day MAs and beneath the daily Ichimoku cloud. Today’s candle, if it closes near 85.5k with a long lower wick, would be a tentative hammer/spinning top at support, but the broader context favors sells into strength.
• Hourly (last 24h): Strong rally 13:00–14:00 up to ~89.3k, then rejection and hard selloff to 84.46k with a heavy-volume flush (19:00). Follow-through buying is modest; the bounce has not reclaimed key intraday supply (87.5–88.0k). Hourly structure: lower highs/lows intact.

Trend and moving averages

• SMA20 (approx): ~89.8k. Price at ~85.5k is below the short-term mean, indicating bearish bias and room for mean-reversion rallies to be sold.
• SMA50 (approx): ~100–102k (given Oct-Nov prices), well above current price. Downtrend intact; rallies struggle below this band.
• SMA200 (approx): ~110–115k. Long-term trend firmly down.
• EMAs (8/21/55): Likely stacked bearishly (8 < 21 < 55) on daily; on hourly, 8 EMA is trying to turn up from oversold but 21/55 sit above ~87.5–88.5k acting as dynamic resistance. Expect rallies to stall near these moving averages.

Momentum indicators

• RSI (14)
  • Daily: Estimated mid-30s to ~40. Not deeply oversold; room exists for additional downside after a modest bounce.
  • Hourly: Oversold on the drop to 84.5k with a potential bullish divergence on the second test around 20:00 (marginally higher RSI despite similar price low). This favors a relief rally into resistance, not necessarily a trend reversal.
• Stochastic (daily): Likely sub-20 and curling; can support a short-lived bounce within a downtrend.
• MACD (daily): Bearish cross below zero and histogram widening negative after the early-Dec bounce failed. This supports selling rallies.
• ADX (daily): Rising above ~25 (qualitative assessment) as trend strengthens to the downside; DM- > DM+ suggests shorts have control.

Volatility and bands

• ATR(14, daily): Approx 4.0–4.5k. Today’s range (low 84.46k, intraday high 89.28k) ~4.82k, consistent with elevated volatility. Plan trades around a ~4k daily swing potential.
• Bollinger Bands (20,2): Mid ~89.8k; lower band estimated ~83.2–84.0k given recent volatility. Price probed near the lower band today and bounced; typical behavior is a mean-reversion push toward the mid-band, but in downtrends moves often stall before mid (~87.5–88.5k zone here) and re-extend lower.
• Keltner Channels (EMA20, ATR-based): Price near/below lower channel; a tag often brings a snapback toward the midline (EMA20 near 89–90k), but trend conditions suggest rejection at or before the midline.

Market structure and price action

• Structure: Since Dec 9 high (~94.6k), BTC has put in a series of lower highs (94.6k → 92.7k → 92.0k → ~90.6k → today’s failed 89.3k). Lows are stepping down (86.3k → 86.1k → 84.5k). The most recent bounce failed below prior intraday supply, confirming bearish control.
• Liquidity/Stops: Today’s sweep to 84.46k likely ran resting liquidity under prior daily lows (Dec 17 ~85.3k zone). The rebound suggests short-term shorts took profit; however, supply overhead remains thick.
• Key intraday supply: 87.3–87.8k (0.618 retrace of today’s selloff; hourly MA confluence); 88.5–89.3k (today’s high/failed breakout and prior distribution shelf).
• Key demand: 84.4–84.8k (today’s flush area); then 83.6k (78.6% Fib of Nov–Dec advance); then 80.7–81k (Nov capitulation low and weekly support).

Volume, VWAP, and profile

• Intraday volume: Peak sell volume at 19:00 (7.59B), characteristic of a stop run and forced liquidation. Subsequent candles show declining buy volume—typical of a weak bounce.
• OBV (qualitative): Downtrend consistent with distribution; no accumulation signature yet.
• Session VWAP: Estimated above price (roughly 87.0–87.6k window through the day). Price below VWAP supports a “sell the VWAP test” play. Expect initial mean reversion push toward VWAP, then fade.
• Volume profile (recent days): High-volume node around 90–92k (major resistance). Secondary node around 86–88k; trading back into this node often meets supply.

Ichimoku (daily)

• Price below cloud; future cloud red; Tenkan < Kijun and both above price. This setup favors rallies failing at the Kijun/Span A area (approx high-80s to ~90k) and trend continuation lower.

Fibonacci mapping

• Nov 21 low (80,660) → Dec 9 high (94,602):
  • 61.8%: ~85,986 (we’re trading slightly below—key decision zone)
  • 65%: ~85,477 (current price nearby)
  • 78.6%: ~83,649 (next strong support)
• Today’s intraday move: Low 84,460 → High 89,284; 61.8% retrace from low is ~87,440—prime short entry if tapped.

Harmonics / Elliott-wave lens (heuristic)

• From Dec 9 high, a 5-leg impulsive decline fits price action, with today likely an interim wave iv bounce attempt after a wave iii flush. If so, a lower high into 87.2–87.8k is favored before a wave v extension toward 84.0–83.6k. Harmonic AB=CD projections from the 14:00–20:00 swings also land ~83.7–84.2k.

Candlestick signals

• Daily: Potential hammer/spinning top if close near 85.5k, but context is downtrend (hammer reliability lower). Confirmation would require a strong follow-through reclaiming 88.5–89k, which is not my base case.
• Hourly: Potential morning-star-like sequence 19:00 (big red) → 20:00 (indecision) → 21:00 (green). This supports a relief rally but not a reversal.

Parabolic SAR / DMI

• SAR likely above price on daily and hourly; until flipped, rallies are sells.
• DMI- dominance with ADX rising supports trend continuation after mean reversion.

Key levels (precision where possible)

• Resistance: 87,200–87,800 (0.5–0.618 retrace of today+EMA/VWAP cluster); 88,500–89,300 (failed high/supply); 90,400–90,600 (round/VAH area).
• Support: 85,200 (intraday shelf); 84,460 (today’s low/liquidity sweep); 83,650 (78.6% of Nov–Dec move); 80,700–81,000 (weekly).

Scenario probabilities (subjective)

• Bearish base case (60%): Relief rally to 87.2–87.8k fails → trend resumes → 84.0–83.6k test.
• Sideways (25%): Range 84.5–88.5k consolidates while volatility compresses before next leg.
• Bullish break (15%): Reclaim and hold above 89.3k on rising volume → squeeze toward 90.4–92.0k; bearish thesis invalidated near that reclaim.

Trade plan (next 24h)

• Strategy: Fade the bounce into the golden pocket of today’s intraday range and hourly EMA/VWAP cluster.
• Entry (Sell short): 87,450 (≈ 61.8% retrace of today’s selloff; within 87.2–87.8k supply). If price gaps straight down without bounce, do not chase; wait for a new weak rally.
• Target (Take profit): 84,050 (front-run 83.65–84.0k support and lower Bollinger band area). This aligns with 78.6% retrace of Nov–Dec advance.
• Invalidation (not requested but prudent): A strong hourly close above 89,300 with expanding volume would negate the short and suggest 90.4–92.0k squeeze risk.
• Notes: Elevated ATR implies swift moves; slippage risk around 84–85k due to liquidity pockets. Using a limit entry in the 87.3–87.6k band improves fill quality.

Risk considerations

• Trend, breadth, and momentum are bearish across timeframes; counter-trend longs are lower probability. Shorting into clearly defined supply with nearby invalidation offers better asymmetry.
• Macro catalysts and weekend liquidity can amplify moves; position sizing should reflect ATR and potential gaps.

Bottom line

• Expect a bounce to 87.2–87.8k, then a roll-over toward 84.0–83.6k within 24 hours. Best expression: Sell the rally, target 84.0k.