Fading the Bounce: Short BLSH Into Confluent 76.4 Resistance for a 72 Handle Target

Comprehensive multi-lens technical read on BLSH (Bullish)

Snapshot and context

• Instrument: BLSH (Bullish), currency $.
• Current price: 74.63 (last trade ~74.50-74.63 into the close of the last hour).
• Structure: Two-session sequence of extreme volatility. 2025-08-13 printed a capitulation day (O 95.69, H 118, L 68, C 68). 2025-08-14 gapped up to 74.40, surged to 84.79, then sold off to close near 74.63. Intraday realized volatility remained elevated.

Price action and market structure

• Daily: After a massive selloff to 68 on 8/13, the next day opened higher and failed to reclaim much of the prior drawdown, closing well below the day’s VWAP. That is classic “dead cat bounce” behavior rather than a trend reversal.
• Intraday 8/14 (1h bars with volume): • 13:30: explosive wide-range up bar (H 84.49, L 71.20, C 83.16) with large volume (16.87M). • 14:30: immediate reversal; long upper wick to 85, close 74.16 on heavy volume (5.79M) — a rejection of the 84–85 zone and a bearish engulfing of momentum. • Subsequent hours printed a sequence of lower highs: 78.79 → 76.40 → 76.399 → 75.55 → 76.40. Market making lower highs and whipsawing within a descending intraday channel suggests supply overhead. • Intraday low 71.25 at 17:30, then a reflex bounce failed beneath 50% retracement levels.
• Conclusion: A “pop-and-fade” day with distribution into strength and acceptance below key retracement/VWAP levels. Near-term structure leans bearish to range-bound with a downside skew.

Support/resistance mapping (levels that actually traded)

• Resistance: 84.5–85 (strong rejection), 79.6 (61.8% of day’s range), 78.0 (50% retrace), 76.4 (38.2% retrace and repeated intraday cap), 75.55 (lower-high print).
• Support: 74.0–74.3 (late-session sticky area), 73.6–73.8 (micro shelf), 72.5, 71.25 (intraday low), 68.96 (next-day S1 pivot, aligns with 8/13 close 68 as deeper support).

Fibonacci retracements (8/14 swing H 84.79, L 71.20; range 13.59)

• 38.2%: 76.39 — repeatedly capped late afternoon.
• 50%: 78.00 — coincides with a failed test (15:30 high 78.79 faded).
• 61.8%: 79.60 — never reclaimed. Interpretation: Sellers defended 38.2–61.8% band; this makes the 76.4–78.0 area a high-probability sell zone on rallies.

VWAP and volume analysis

• Session VWAP (1h, volume-weighted across trading hours with actual volumes) ≈ 77.85. Current price 74.63 is materially below VWAP, indicating net distribution and sellers in control for the day. The strongest volume prints occurred during the up-thrust and the reversal hour, typical of a blow-off + supply dump.
• Volume pattern: Peak volume on the spike (13:30) and on the rejection (14:30), then diminishing into the close — consistent with a transition from momentum to distribution and a lack of aggressive dip buying.
• OBV (qualitative): Given the heavy distribution bar and close under VWAP/pivot, OBV likely rolling over versus the early spike, not confirming a sustained uptrend.

Momentum indicators (qualitative/approximated from the 1h sequence)

• RSI(9–14h, approximate): Mid-40s, reflecting loss of momentum after the early spike and consistent with a bearish-to-neutral regime.
• MACD (1h): Momentum peaked on the opening impulse; histogram rolled negative into the afternoon with price making lower highs — bearish divergence versus the morning thrust.
• Rate of Change: From 13:30 close 83.16 to last ~74.5, roughly −10.4% — momentum cooling and trending below intraday mean.

Moving averages (intraday 1h)

• SMA(9) of hourly closes ≈ 75.51; last trade ~74.6 below the SMA — near-term bearish bias.
• Price is also below session VWAP (77.85) and below next-day daily pivot (see below) — supports “sell rips” strategy.

Volatility/ATR

• 1h True Range across 8 key bars: [13.29, 11.42, 4.99, 3.10, 2.84, 3.90, 1.95, 2.40]; average ≈ 5.49. That’s ~7.4% of spot — very elevated. Expect a 24h range on the order of 1.5–2.0× 1h ATR ≈ 8–11 points.
• Implication: Wider stops and profit targets are warranted; fading extremes toward key levels offers better expectancy than chasing moves.

Pivot points (for next session based on 8/14 H/L/C: 84.79/71.20/74.63)

• Pivot P = (H+L+C)/3 ≈ 76.87.
• R1 ≈ 82.55; S1 ≈ 68.96. R2 ≈ 90.46; S2 ≈ 63.28.
• Current price below P reinforces bearish bias; R1 aligns near the rejection zone; S1 is near the prior capitulation close — a tail risk if selling accelerates.

Bollinger/Range context (qualitative)

• Given the enormous intraday range, bands would be flared. Price finished in the lower half of the day’s envelope and failed to close above mid-band equivalents, suggesting rallies are being sold.

Ichimoku (qualitative)

• With only short intraday history, Tenkan/Kijun likely above current price; price is below any reasonable intraday cloud projection following the reversal — another bearish cue.

Pattern recognition

• Intraday “blow-off to rejection” followed by a descending channel (bear flag/pennant morphology). Multiple failed recoveries at 76.4–78 confirm supply. The 71–72 zone acted as demand on first touch; odds favor a retest within the next 24h if 76.4 remains intact.

Mean reversion vs. trend synthesis

• The dominant intraday impulse trend (post-14:30) is down; mean reversion would target VWAP ~77.85. But repeated failures below 76.4 imply “reversion-to-lower-mean” rather than a full VWAP tag unless there’s a catalyst. Thus, optimal expectancy is to fade pops into 76–77 area for a move back toward 72–73.

Risk management and scenario map (next 24h)

• Base case (60%): Price rallies toward 76.0–76.5 (38.2% Fib / intraday cap), stalls, and rotates down to 72.0–73.0.
• Alt 1 (30%): Choppy range 72–78 without decisive break; multiple tests of 74–76 value area; still favors selling strength and covering into 72–73.
• Tail (10%): Squeeze above 78.0 (50% Fib) triggers stops and a VWAP reclaim toward 79.6–82.5; would invalidate the short thesis and demand exit.

Trade thesis and execution plan

• Edge: Confluence sell zone at 76.4 (38.2% Fib), under the daily pivot (76.87), beneath session VWAP (77.85), and within a series of lower highs. Distribution profile supports selling rips.
• Entry: Use a limit to short into 76.2–76.4 area to gain favorable R:R and reduce slippage in high volatility.
• Target: 72.2 — above the 71.25 intraday low to increase fill probability and capture a significant portion of expected range.
• Invalidation (stop idea, not an order here): A sustained break and hourly close above 78.2 (50% retrace + local supply) would negate the setup; risk ~2.0 pts for ~4.0 pts reward (R:R ≈ 2:1).

24h price path expectation

• Likely session envelope: 71–79, with mid gravitating around 74–75. Skew: downside retest favored unless 78 is reclaimed and held.

Conclusion All lenses (VWAP below, repeated Fib rejections, lower highs, sub-pivot trade, and elevated ATR favoring sell-the-rip) point to a tactical short. Optimal is to let price come to you at 76.2–76.4 and ride a fade to ~72.2 within the next 24 hours.