Step-by-Step Technical Analysis of Bitcoin (BTC)

1. Long-term and Medium-term Trend Analysis

Daily Chart Trend

• Mid-May to mid-July: BTC experienced a strong bull run, moving from ~$97,000 to peak above $123,000 (July 14). Volume saw a pronounced spike on July 14 (181B), identifying a blow-off top pattern.
• Post-July 14: From the July 14 high, BTC entered a corrective phase. The uptrend broke, with a sequence of lower highs: $123,091 → $119,935 → $120,065 → $120,999 → $120,851 → $120,269, and then a marked range-bound and downward sequence.

Recent Weeks (Late July – Early August):

• Consistent Lower Highs and Lower Lows: Prices slid from ~$120,000 by late July to today’s $113,562, producing a series of descending closes.
• Descending Channel: Action since July 14 suggests a well-defined descending channel with resistance near $119,000–$120,000 and support slowly shifting lower ($112,000–$113,000 region).

2. Volume Analysis

• Peak Spike: July 14’s massive volume aligns with a local top and distribution event.
• Diminishing Volume During Decline: Volume on recent red candles (late July and first week of August) is elevated but not matching the July peak, suggesting continued selling pressure after distribution without the blow-off/final wash-out signal.
• No Capitulation Yet: Despite sustained selling, absence of a final capitulation volume spike means bears likely have control for now; further downside likely until panic sellers exhaust.

3. Short-Term Price Action (Intraday – Last 24 Hours)

• Choppy Decline & Weak Rallies: BTC opened the day at $115,075, sold down aggressively to as low as ~$112,720 (14:00–15:00 UTC), and is closing the analyzed period at $113,562. Attempts at rallies (11:00 and 19:00–20:00 UTC) lack follow-through, each met with renewed selling.
• Support and Resistance:
  • Minor support found around $112,700–$113,000 after earlier intraday bounces.
  • Resistance at $114,000–$114,500; sellers step in above this area.
• Volume Exhaustion: No intraday candle shows the high volume/large-wick reversal profile typical for a strong bottom.

4. Moving Averages

• Short/Medium Exponential Moving Averages (EMA):
  • Estimated EMA20, EMA50 (based on the persistent downtrend and closing rates) are above current price (likely around $116,000–$117,000).
  • Price is trading below all key short/medium-term averages; this bodes bearish for the coming 24–48h.
  • Crossed downward early August – a classic bear signal.

5. Relative Strength Index (RSI, Estimated with Price Behavior)

• The persistent drop over three weeks, coupled with only weak bounces, implies RSI is trending toward/into mild oversold territory, possibly mid/high 30s on the daily chart. However, no deeply oversold flash signals yet.

6. Chart Patterns & Candlestick Analysis

• Bear Flags and Rising Wedges: Multiple attempts at hourly and daily recoveries all failed at resistance, forming classic bear flags/rising wedges that resolved lower.
• No Hammer/Doji Bottom: Recent daily and hourly closes lack reversal formations; most are overpowered bearish candles, showing failed attempts at defense by bulls.

7. Support and Resistance Levels

• Immediate Support: $112,700–$113,000. If this breaks, next support zone: major daily low cluster at $111,900–$112,500 (tested repeatedly Aug 1–3).
• Immediate Resistance: $114,500–$115,000 (intraday tops, EMA resistance), then $117,000 (cluster of failed bounces in late July).

8. Volatility Measures

• Standard Deviation of Hourly Moves: Volatility is high (ranges of $2,000–$3,000 intraday), suggesting that even if price trends lower, sharp relief rallies or wicks are likely.

9. Order Book/Market Sentiment (Proxy via Price/Volume Behaviour)

• Recent inability to sustain price above $114,000, despite multiple attempts, suggests persistent supply from larger players. Rejected rallies reinforce short-term bear bias.

10. Fib Retracement (from June–July uptrend low to high)

• 38.2% Fib (using $97,000 low to $123,000 high) ≈ $113,830
• 50% Fib ≈ $110,000
• Current price struggling at 38.2% Fib – a commonly watched level. If $113,830 fails, expect test of 50% Fib near $110,000.

11. Elliott Wave Analysis (Macro, Subjective Quantification)

• The impulsive run up through early July and the subsequent sharp correction indicates a likely completion of a Wave 3/5 scenario and now in a Wave A (corrective) with Wave B (relief rally) yet to materialize.

12. Summary of Analysis and Trading Plan

• The charts, indicators, and price structures unanimously signal that bears remain in control. Key support at $113,000–$112,700 is under threat. With each bounce weaker than the last, the probability of a break below $112,700 is high. If so, next support is $110,000, coinciding with the 50% retracement of the June–July move.
• Reversal signals are absent: no large bullish wicks, hammer candles, or capitulation spikes. Shorter-term oversold does suggest possibility for relief bounces, but these are expected to be sold.
• Risk for shorts is a sudden short squeeze, but the reward/downside is more likely in favor of the bears for the next 24 hours.

Final Bias: With strong selling, no reversal, breaking through key supports, and sustained below all moving averages, initiate a short position (Sell) targeting break of $113,000, with take profit at $111,000–$110,500 area. Stop loss should be considered above $115,000–$115,500 (not required for this analysis but critical for risk management). Wait for breakdown retest; optimal entry is slightly below support after confirmation of breakdown.

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24-Hour Forecast

Likely Direction: Down/downside volatility towards $111,000–$110,500 Optimal Sell Entry: Upon break and retest of $113,000 support, at $112,900 Take Profit (Close Order): $110,600 (next major support/Fib 50%) Risk: Relief bounces and volatility, but overall technical bias supports further downside before any sustained reversal.

Conclusion: SELL (SHORT POSITION)

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Keywords

BTC, Bitcoin, bear trend, support, resistance, blow-off top, descending channel, volume spike, lower highs, lower lows, capitulation, Fib retracement, EMA, RSI, short position, volatility, chart pattern, corrective phase, blow-off top, distribution, order flow