Bears in Control – Is This the Start of a Major Market Crash?
The BTC chart shows a clear break in market structure where the bullish trend was invalidated after failing to maintain higher highs. The red zone represents a key support level that previously held price multiple times, showing strong buying interest. However, once this level was decisively broken to the downside, the market structure shifted bearish, confirming that sellers are in control.
When price returned to this zone, it retested the broken support and rejected sharply, flipping the area into a resistance zone. This rejection further validated the bearish sentiment and set the stage for a continuation to the downside.
Order Flow and Liquidity Grab
The current price action suggests that the market is targeting liquidity pools resting below the previous lows. The black line on the chart marks a key swing low, where liquidity is likely building up from stop-loss orders of retail traders. The market tends to gravitate towards these liquidity zones before reversing or continuing its trend.
The sharp rejection from the resistance level signals that the market is still heavily bearish and hunting for sell-side liquidity.
Fair Value Gap (FVG) and Retracement Zone
The green zone highlights a fair value gap (FVG) – an imbalance in price action where the market moved rapidly without leaving sufficient trading activity. These gaps often act as magnets, drawing price back to fill the imbalance before continuing in the original direction.
A retracement into this zone would not only fill the imbalance but also allow the market to mitigate unfilled orders left behind by institutions. This would create an ideal area for short re-entries before the next leg lower.
Fundamental Influence
Despite the recent bullish news event, which temporarily pushed the price higher, the impact lasted only a few hours. This indicates that the news failed to shift the overall market sentiment, and the bears quickly regained control. The market's reaction highlights the underlying weakness in bullish momentum.
Additionally, the recent tariff announcements by Donald Trump have created a more bearish macroeconomic environment, adding extra selling pressure. Increased tariffs could negatively impact global market sentiment, which aligns with the technical bearish outlook.
Trade Plan and Confirmation
The most likely scenario would be a retracement into the FVG zone (green area), followed by bearish price action confirmation (such as a bearish engulfing candle or lower timeframe structure break).
Key confirmation points:
Target Areas
The primary target for this trade setup would be the liquidity pool resting below the black line. This level represents a clear liquidity grab zone, where the market could look to sweep lows before any potential reversal.
Invalidation Level
The trade idea would be invalidated if price breaks above the red resistance zone with strong momentum, signaling a possible shift back to bullish market structure.
Conclusion
This trade setup combines technical analysis with fundamental factors, creating a confluence-based bearish outlook. The rejection from the resistance zone, the presence of an FVG imbalance, and the overall bearish macro sentiment support the continuation of the downtrend. Waiting for price to fill the imbalance before entering could provide a high-probability entry for a short position targeting the liquidity grab at the lows.
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When price returned to this zone, it retested the broken support and rejected sharply, flipping the area into a resistance zone. This rejection further validated the bearish sentiment and set the stage for a continuation to the downside.
Order Flow and Liquidity Grab
The current price action suggests that the market is targeting liquidity pools resting below the previous lows. The black line on the chart marks a key swing low, where liquidity is likely building up from stop-loss orders of retail traders. The market tends to gravitate towards these liquidity zones before reversing or continuing its trend.
The sharp rejection from the resistance level signals that the market is still heavily bearish and hunting for sell-side liquidity.
Fair Value Gap (FVG) and Retracement Zone
The green zone highlights a fair value gap (FVG) – an imbalance in price action where the market moved rapidly without leaving sufficient trading activity. These gaps often act as magnets, drawing price back to fill the imbalance before continuing in the original direction.
A retracement into this zone would not only fill the imbalance but also allow the market to mitigate unfilled orders left behind by institutions. This would create an ideal area for short re-entries before the next leg lower.
Fundamental Influence
Despite the recent bullish news event, which temporarily pushed the price higher, the impact lasted only a few hours. This indicates that the news failed to shift the overall market sentiment, and the bears quickly regained control. The market's reaction highlights the underlying weakness in bullish momentum.
Additionally, the recent tariff announcements by Donald Trump have created a more bearish macroeconomic environment, adding extra selling pressure. Increased tariffs could negatively impact global market sentiment, which aligns with the technical bearish outlook.
Trade Plan and Confirmation
The most likely scenario would be a retracement into the FVG zone (green area), followed by bearish price action confirmation (such as a bearish engulfing candle or lower timeframe structure break).
Key confirmation points:
- Price taps into the green zone without breaking above it.
- Bearish candle patterns or lower timeframe structure shifts.
- Volume increase during rejection.
Target Areas
The primary target for this trade setup would be the liquidity pool resting below the black line. This level represents a clear liquidity grab zone, where the market could look to sweep lows before any potential reversal.
Invalidation Level
The trade idea would be invalidated if price breaks above the red resistance zone with strong momentum, signaling a possible shift back to bullish market structure.
Conclusion
This trade setup combines technical analysis with fundamental factors, creating a confluence-based bearish outlook. The rejection from the resistance zone, the presence of an FVG imbalance, and the overall bearish macro sentiment support the continuation of the downtrend. Waiting for price to fill the imbalance before entering could provide a high-probability entry for a short position targeting the liquidity grab at the lows.
__________________________________________
Thanks for your support!
If you found this idea helpful or learned something new, drop a like 👍 and leave a comment, I’d love to hear your thoughts! 🚀
Make sure to follow me for more price action insights, free indicators, and trading strategies. Let’s grow and trade smarter together! 📈
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BTC is currently about to close above the gap, lets see what happens after
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Experienced trader with 6 years of expertise in all markets. 💼
Follow me for:
📊 Market updates
🔍 Indicators
📚 Educational content
Follow me for:
📊 Market updates
🔍 Indicators
📚 Educational content
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.