BTC Teeters Below 90k: Short the Bounce Into 88k, Targeting an 84k Retest

Executive summary and immediate thesis

• Regime: BTC remains in a medium-term downtrend. Price is trading well below the 20-day SMA (~91.9k, approximate) and far below the 50-day trend, after cascading lower highs since early October. Today’s session broke the 90–92k balance, printed a fresh intraday low near 83.9k, then bounced toward 86.4k. This looks like a classic breakdown -> reflexive bounce -> likely bearish retest setup.
• 24h base case: Expect the bounce to extend into the 87.4–88.3k Fibonacci retrace cluster, meet supply, then roll over to retest 85.0–84.0k (with 83.5–84.0k as key demand). Optimal trade: Sell the bounce into 87.5–88.0k, targeting 84.3k.

1. Price action and structure (multi-timeframe)

• Daily structure (Sep -> now): Sequence of lower highs from the October peak (~126k) to late-Nov highs (~92k), with successive lower lows (Nov 20 low ~86.6k, today’s low ~83.9k). The 90–92k zone that acted as short-term support last week broke today, converting into resistance.
• Key daily levels from the provided data: • Resistance: 88.0–88.5k (near today’s 0.618 bounce zone), 90.5–91.9k (prior range highs and repeated rejection area), 93.0k (late-Nov swing high cluster 92.9–93.5k). • Support: 85.2k (intraday ledge), 84.0k round, 83.5k (11/22 low zone), extension supports 81.5k and 80k if 83.5k fails.
• Intraday (hourly) sequence today: • 15:00 UTC candle flushed to 83.9k, the session low, on high volume. Subsequent hours stair-stepped higher lows (84.5k -> 85.0k -> 85.5k -> 86.4k), indicating an oversold bounce, not a trend change. Price is still well below the broken 90–92k shelf. • This is typical of a breakdown day: strong dump, stabilization, then a retrace toward supply zones (VWAP/EMAs/Fib), often sold.

2. Trend and moving averages

• 20-day SMA (approx) ≈ 91.9k, price ≈ 86.4k (about 6% below): bearish.
• 50-day trend direction: clearly down given the October -> November shift. Price sits decisively below both short- and intermediate-term trends.
• Takeaway: Trend following systems remain short-biased until price reclaims and holds above ~92k.

3. Volatility and ranges (ATR, Bollinger)

• Daily ATR(14) (approximation from recent ranges) ≈ 3.0–3.5k. Today’s high/low swing (from ~91k pre-breakdown yesterday to ~83.9k intraday today) confirms elevated realized volatility.
• Bollinger Bands (20,2) using 20D SMA ≈ 91.9k: • Lower band estimate ≈ 83.5–84.0k (SMA – 2*SD), which aligns with today’s low tag (~83.9k). Price tagged the lower band and bounced—typical mean-reversion behavior within a broader downtrend. Often the first test bounces; the second test risks a break.
• Implication for next 24h: One ATR up from the low places a logical bounce cap around 87.5–88.0k; one ATR down from current areas targets 83.5–84.5k.

4. Momentum (RSI, MACD, Stoch)

• Daily RSI(14) qualitative read: sub-50 and likely in the 35–45 zone given persistent lower highs and fresh breakdown. That’s bearish momentum with room for short-lived mean reversion.
• Daily MACD: Bearish and below zero since early November; minor improvement early last week stalled; today’s breakdown likely re-widens the negative histogram.
• Hourly momentum: Oversold earlier (flush to ~83.9k), now normalizing into the 50 area as price bounces. This favors a tactical short on strength rather than pressing shorts at the low.
• Synthesis: Momentum supports a sell-the-bounce approach.

5. Volume and participation

• Today’s partial daily volume (~87B) stands out, consistent with breakdown days and stop cascades. The bounce from 84k to 86k unfolded on lighter, stabilizing volume versus the initial dump—indicative of short covering and dip nibbling, not aggressive trend reversal buying.
• Prior week’s rallies toward 91–92k showed fading upside follow-through. Overhead supply remains heavy in 88–92k.

6. Key levels and confluence (Fibonacci, prior pivots, VWAP proxy)

• Today’s intraday leg: 91.0k (pre-break area) -> 83.9k (low). • 0.382 retrace ≈ 86.6k (already tagged/current zone). • 0.5 retrace ≈ 87.45k. • 0.618 retrace ≈ 88.28k. These align with visible supply bands and recent micro-pivots.
• Prior daily resistance shelf: 90.5–91.9k. Any squeeze into this band would be a high-probability fade unless reclaimed with strong volume.
• Volume-weighted logic (qualitative): Anchoring today’s VWAP from the open (~90.38k), the heavy downside skew implies VWAP/trend VWAPs sit above current price and likely converge around 87–88k—right where we plan to fade.

7. Ichimoku (daily qualitative)

• Price below cloud, Tenkan < Kijun, Span A < Span B: fully bearish regime. Price would need to reclaim and base above the Kijun (~near the 20D SMA region) to hint at a trend change. We’re not close.

8. Pattern read

• Macro: A broad descending channel since October peak, with a failed bounce last week and fresh expansion lower today. The 90–92k rectangle broke—this is a regime shift lower.
• Micro: Today’s hourly rebound resembles a bear-market rally/ABC corrective pop into 0.5–0.618 before continuation.
• Possible double-bottom attempt near 83.5–84.0k: First tag 11/22 (~83.5k), second tag today (~83.9k). However, confirmation requires reclaiming 90–92k; until then it’s only a potential support, not a base.

9. Scenario tree for the next 24 hours

• Base case (55%): Bounce extends into 87.5–88.3k (0.5–0.618 Fib), stalls, and rolls back to 84.0–85.0k. Close near 85k. Best execution: Short 87.5–88.0k, TP 84.3k.
• Bear extension (25%): Early failure below 86.6k; momentum resumes lower, breaks 83.5–84.0k. Slide toward 81.5–82.5k before a late bounce. In this case, fills may not reach 87.5; aggressive traders could scale from 86.8–87.5.
• Squeeze risk (20%): Strong short-covering pushes through 88.3k and tests 90.5–91.0k. Only a decisive reclaim/hold above 91.9–92.0k would flip the 24–72h bias to neutral-to-bullish. Until then, rallies are sells.

10. Risk management and execution logic

• Optimal entry: Sell limit into 87.5–88.0k where Fib 0.5–0.618 meet intraday supply and likely anchored VWAP. This avoids shorting the hole and improves R:R.
• Protective invalidation (not part of requested fields but crucial): A logical stop sits above 90.6–91.0k (prior shelf and round-number magnet). A tighter tactical stop could be 89.6k if seeking higher RR but with greater stop-out probability.
• Take profit: First target 84.3k (above 84.0k demand to increase fill odds). Secondary extension 83.6k if momentum accelerates.
• Position sizing: With ATR ~3–3.5k, targeting ~3.2–3.5k down-move versus ~2.1–3.1k risk offers ~1.1–1.6x RR depending on stop selection. Scale-outs can enhance expectancy.

11. Why not buy the dip here?

• Trend and breadth remain negative with overhead supply thick between 88–92k.
• Today’s bounce is corrective (into Fib/VWAP/MAs) with momentum still below key thresholds on daily. A buy would be countertrend; better probability to buy after a base forms above ~92k or on a capitulation flush followed by a strong reclaim.

Call and 24h path

• Bias: Sell the bounce.
• Expected path: Drift/coil in 86–87k early Asia, probe 87.5–88.0k, sellers reassert, pullback to 85.0–84.3k into US session. Watch 83.5–84.0k for potential late-day defense. Reclaiming >88.3k risks a squeeze toward 90k; >91.0k invalidates the immediate short.