As predicted in my previous analysis, Bitcoin followed our roadmap to the dollar. We saw the exact flush to the $86k demand zone, followed by a surge back to $90,300 where price faced the rejection we anticipated. Now, the market has coiled into a tight wedge, setting the stage for the next decisive move.

Bitcoin is now trapped in a converging wedge with ascending support at $87,533 and descending resistance at $87,319. With 10 touches validating that support line and volume 68% below average, we're in the calm before the storm. Breakout is expected within 10 bars.

1. The Technical Reality 📉

  • Price trading below all three major EMAs (20/50/200) creating overhead resistance.
  • Wedge compression to $214 width signals forced resolution imminent.
  • 40.2% lower wick vs 40.9% upper wick = perfect equilibrium between bulls and bears.
  • 10 touches on ascending support from $84,408 make this an exceptionally validated trendline.

2. The Indicators ⚖️

Bearish Signals

  • MACD bearish with line at 84.29 below signal at 90.08.
  • Trading below entire EMA cluster creates natural resistance.
  • Recent rejection at bearish order block ($90,599-$89,109).

Bullish Signals

  • Bullish order block at $87,555-$86,760 aligns with ascending support.
  • RSI at 51 shows room to move either direction.
  • Ascending trendline has held 10 consecutive tests.
The Conflict: MFI at 49.7 and volume 68% below average ($4,999 vs $15,693) reveal neither side has conviction. The market is waiting for a catalyst to commit capital.

3. The Trade Setup 🎯

🔴 Scenario A: Wedge Breakdown (Higher Probability)

Trigger: 4H close below $87,533 with above-average volume

Entry: $87,400 on confirmed break

  • Target 1: $86,355 (1.4% move, recent swing low)
  • Target 2: $85,073 if selling accelerates
  • Stop Loss: $88,200 (0.8% risk = 1.6:1 R/R to first target)

🟢 Scenario B: Wedge Breakout (Lower Probability)

Trigger: Reclaim $88,200 and break through EMA cluster

Entry: Break above $89,557 (immediate resistance)

  • Target: $90,599 (bearish OB), extended to $92,018 (premium zone)
  • Invalidation: Failure to hold $88,200 on retest

CRITICAL LEVEL: 4H close above $90,599 invalidates the entire bearish thesis and signals Change of Character bullish.

My Verdict

The setup slightly favors bears at 72% confidence due to EMA structure and MACD momentum, but that ascending support has earned respect with 10 touches. I'm treating this as a patience game, waiting for the wedge to break with volume confirmation rather than front-running. The compression rate suggests resolution within 24-48 hours. When a trendline this validated breaks, stop losses cascade and accelerate the move.

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