Will BTC Soar or Sink? H4 Price Action Secrets Unveiled
2025-01-22
Category: None

Market Structure Overview
The BTC/USDT chart on the H4 timeframe showcases a market transitioning from an uptrend into a potential consolidation or early trend reversal phase. Key observations include:

Higher Highs (HH):
January 18–20 showed a consistent upward push, with a peak HH near $108,000.
Higher Lows (HL):
A steady rise in HLs, with support forming near $100,000, followed by another HL around $102,000.
Resistance: The price appears capped around $108,000, with a slight bearish reaction indicating sellers stepping in.
Support: The most recent support zone is around $102,000.
This structure suggests we are in a potential trading range between $102,000 (support) and $108,000 (resistance) after an aggressive upward move.


🐂 Bullish Scenario:

The market is still producing HLs, indicating buyers are willing to step in.
Price remains above the moving average (pink line), which acts as dynamic support.
The consolidation could be a Bull Flag, a continuation pattern.
If $108,000 breaks, a Measured Move target around $112,000-$114,000 is possible (based on the range from $102,000 to $108,000).

Bullish Plan:

Entry: Go long above $106,000 on a strong breakout candle.
Stop-Loss: Below $104,000 (just under recent HL).
Profit Target: $112,000-$114,000 (measured move target).
Probability: 60%, given the recent trend and buyer strength.

🐻 Bearish Scenario:

The double top at $108,000 hints at resistance, with sellers defending this level.
Bearish candles breaking below $104,000 could suggest a short-term reversal.
If the price falls below $102,000, it would form a Lower Low (LL), initiating a bearish trend.
Possible exhaustion of buyers after the last HH spike.

Bearish Plan:

Entry: Short below $104,000, confirming a breakout of support.
Stop-Loss: Above $106,000 (above consolidation high).
Profit Target: $100,000 and potentially $98,000.
Probability: 40%, as the structure currently favors bulls.

Educational Patterns for New Traders
Inside Bars:
Watch for smaller candles forming within the previous candle's range. They often precede breakouts.
Measured Moves (MM):
The distance of the previous range (e.g., $102,000–$108,000) can be projected upward or downward after a breakout.
Exhaustion Gaps:
Be cautious of sharp moves upward (like near $108,000); they may signal buyer exhaustion.
Higher Highs and Higher Lows:
These are critical in identifying trends. Bulls need a HH break for confirmation, while bears look for LLs to gain control.


Trader’s Equation Summary
Bullish Plan: Risk = $2,000 (from $106,000 to $104,000); Reward = $6,000-$8,000 ($112,000-$114,000). Reward-to-Risk = 3:1 to 4:1.
Bearish Plan: Risk = $2,000 (from $104,000 to $106,000); Reward = $4,000-$6,000 ($100,000-$98,000). Reward-to-Risk = 2:1 to 3:1.

Final thoughts: The bias leans slightly bullish, but the trading range breakout will confirm the next dominant move. Stay flexible!

What do you think will happen next? Will BTC bulls dominate, or will bears take control? Share your thoughts below, and let’s discuss potential setups!