BTC New Year Squeeze Setup: Ascending Triangle Eyes 90.7k on Breakout

Executive summary

• Bias next 24h: Mildly bullish, expecting a range expansion to the upside if 88,950–89,300 breaks. Base case path: 88.0–88.5k consolidation → breakout test 88.95–89.30k → extension into 90.2–90.9k.
• Structure: Ascending triangle on late-Dec/Jan 1 prints with flat resistance near 88.9–89.3k and rising higher-lows from 86.7k → 87.1k → 87.5k → 87.8k.
• Momentum/volatility: Short-term momentum turning up (price reclaim above 20SMA/short EMAs), daily volatility compressed (Bollinger pinch), favoring a squeeze once resistance is cleared.
• Trade plan: Buy a confirmed breakout above 88,950; primary target 90,700 (measured move + fib confluence). Pullback alternative: buy 88,050–88,250 with invalidation below 87,600.

1. Market structure and multi-timeframe read

• Higher-timeframe (daily): • From early Oct peak ~126k, BTC trended down into late Nov low near 80.7k, then staged a rebound and carved a broad 86–95k range through December. • December price action tightened: highs stepped down from mid-94s (Dec 3–10) to ~90.3k (Dec 30), while lows rose from 85.5k (Dec 18) to 87.1k (Dec 31). This compresses into a symmetrical/ascending triangle hybrid with a clearer horizontal supply shelf around 88.9–89.3k. • Last 20 daily closes average ~87,823 (20SMA est.). Current price ~88,270 trades slightly above the 20SMA, hinting short-term bullish tilt while still under the 50/100-day trend filters (macro downtrend intact but losing momentum).
• 4h timeframe: • Sequence of higher lows since Dec 18: 85,463 → 86,144 → 86,718 → 87,130 → 87,509 → intraday floors 87,8xx on Jan 1. Highs capped around 88,9–89,3k (Dec 30 high 89,298). This is a classic ascending triangle: rising demand absorbs supply under a flat cap. • Intraday on Jan 1 shows steady bids with shallow dips, breakout probe at 17:00 to 88.36k, then holding the 88k handle. The behavior is accumulation-like rather than distribution.
• 1h/15m micro: • Micro higher lows: 87,700–87,900 defended repeatedly. Tight intraday range 87.4–88.4k most of the day, expanding to 88.3–88.4k into late session; buyers stepped in on minor pullbacks. • Liquidity likely resting above 88.9–89.3k (double cap) and below ~87.1k (last swing low). Given the squeeze, a stop-run/expansion is likely next.

2. Key levels (spot)

• Resistance: • 88,950–89,300: horizontal cap (Dec 30 high 89,298; 38.2% fib of 12/9–12/18 swing at ~88,956). Primary breakout trigger. • 90,000–90,300: round number + Dec 30 high vicinity; minor supply zone. • 90,700–91,100: measured move target from triangle plus 50%/61.8% fib retraces of 94.6k → 85.5k swing (~90,033/91,110) – confluence area.
• Support: • 88,000–88,200: intraday pivot and VWAP neighborhood; first demand on pullbacks. • 87,600–87,700: density of recent lows; invalidation for aggressive longs. • 87,100–87,300: Dec 31 low cluster; break opens 86.4–86.7k. • 85,400–86,200: December base; loss would revive medium-term downtrend risk.

3. Trend/indicator toolkit

• Moving averages (daily): • 5SMA ~87,743; 20SMA ~87,823. Price (88,27k) above both, 5SMA converging toward 20SMA – early bullish rotation. Still likely below 50SMA/100SMA (estimated mid-90s/low-100s), so macro remains below trend until 92–95k reclaimed. • EMAs (8/21 est.): Price sits above 8EMA and near/above 21EMA, a constructive short-term alignment.
• RSI: • Daily RSI likely hovering near 50–52 (neutral-to-slightly bullish), with a sequence of higher lows since mid-December. Not overbought; room to expand. • 4h RSI grinding 50→60 region consistent with an impending breakout if resistance gives way.
• MACD (daily): • Histogram flattening-to-positive; signal lines compressing below zero – a typical pre-expansion look after a vol crush. A clean push over 89k should flip histogram more decisively positive.
• Stochastics: • On 4h, oscillators have reset several times without losing price – bullish ‘grind’ character. Daily stoch rising from mid-range supports continuation.
• Bollinger Bands (20, daily): • Bands pinched; centerline ~87.8k. Upper band approx low-91s, lower ~84.6–85k. Price hugging mid-to-upper band signals upside skew during a squeeze regime.
• Ichimoku (daily): • Price likely below a still-elevated cloud (lag from the Oct/Nov heights), but above Tenkan and approaching Kijun. Tenkan support near 88.5k, Kijun ~89.1–89.5k. Clearing Kijun + flat cloud levels near 90k tends to accelerate moves.
• ATR/Volatility: • Daily ATR contracted from ~5–7k (Nov) to ~1.8–2.2k (late Dec). Compression favors a directional move; structure skews that move upward on breakout.
• Volume/market profile: • December’s heaviest transactions clustered 88.5–89.0k (local POC/VAH). Acceptance above this node should usher price into the 90–91k pocket where overhead volume is thinner, enabling faster travel.

4. Fibonacci and measured moves

• Local swing: 12/9 high 94,602 → 12/18 low 85,463. • 38.2%: 88,956 (aligns with our breakout line) • 50%: 90,033 • 61.8%: 91,110
• Ascending triangle measured move: • Height ~ (resistance 88.95k – base 87.1k) ≈ 1.85k. Breakout target ≈ 88.95k + 1.85k ≈ 90.8k. This dovetails with fib 50–61.8%.
• Extensions: • If momentum is strong, 1.272–1.618 extensions from the 12/18 swing imply 91.5–92.4k as stretch targets, but that likely requires a firm daily close >90.3k first.

5. Pattern recognition and probabilities

• Ascending triangle beneath a well-defined shelf is a high-quality continuation/reversal setup in compressed environments. Given the prior leg into the pattern was sideways-to-up from 85.5k, the breakout is more likely up than down.
• Probability weighting (next 24h): • Upside breakout to 89.0–90.7k: ~60% • Range hold 88.0–88.9k (no resolution): ~30% • Downside failure to 86.8–87.3k: ~10%

6. Alternate scenarios and invalidation

• Bearish: • Failure at 88.95–89.30k with impulsive rejection and loss of 88.0k would likely revisit 87.6k; a break of 87.1k opens 86.4–86.7k and invalidates the triangle.
• Bullish extension: • Clean hourly close above 89.3k followed by acceptance over 90.0–90.3k invites a run to 90.7–91.1k, potentially 91.5k if volume expands.

7. Execution plan (precise)

• Primary setup (breakout buy): • Entry: Buy stop at 88,950 to confirm breach of the 38.2% retrace and horizontal cap. • Initial take-profit: 90,700 (triangle measured move + fib confluence). • Preferred stop (not part of output fields): 88,000–88,100 (below breakout structure), yielding ~+1,750 upside for ~−850 to −950 risk (R:R ~1.8–2.0). Conservative stops can sit below 87,600 if allowing more noise (R:R ~1.3).
• Alternative (pullback buy for better R:R): • Entry: 88,100 ±50 (VWAP/pivot zone) if offered; invalidation below 87,600; targets unchanged. This improves R:R but risks missing the move if no pullback.

8. Why not short here?

• Shorting directly into 88.9–89.3k resistance is a valid range-top fade in isolation, but the confluence of: higher lows, MA reclaim, MACD/RSI posture, Bollinger pinch, and fib alignment at the breakout level, argues the risk of an upside squeeze is elevated. Fade attempts have poorer expectancy unless rejection is confirmed with rising volume and a loss of 88.0k.

9. Next 24h expectation

• Baseline path: Intraday coil below 89k → stop liquidity sweep above 88.95–89.30k → momentum continuation into 90.2–90.9k. Momentum may stall near 90.7k; expect profit-taking wicks and possible backfill to ~89.9k after the first thrust.

10. Risk notes

• Holiday liquidity and reopening flows can exaggerate moves in both directions. Use conditional entries and respect invalidation. If breakout occurs on anemic volume and immediately fails back below 88.9k, stand aside and reassess.

Conclusion

• The market shows a maturing base, rising micro-structure, and a volatility squeeze into a well-defined cap. Odds favor an upside resolution toward 90.7k within the next 24 hours if 88.95–89.30k is breached. Executing via breakout confirmation balances participation with risk control.