BTC/USD — Daily Chart Analysis: Falling Wedge Breakout and Bullish Continuation Setup
Pattern Recognition:
Bitcoin (BTC/USD) has been consolidating within a large Falling Wedge formation for the past several months, following its previous strong rally. A Falling Wedge is a bullish reversal pattern characterized by converging trendlines, with the slope of the support trendline being less steep than the resistance trendline — showing a gradual weakening of bearish momentum.
Over time, the selling pressure diminished, and buyers began to step in at a strong horizontal support zone around 77,675 USD, forming multiple higher lows inside the wedge — a classic bullish signal.
Technical Highlights:
🔹 Support and Resistance:
Major support was defended aggressively between 76,000 - 78,000 USD, confirming institutional demand in this zone.
Immediate resistance existed around the 94,000–95,000 USD region — a critical structure that price needed to reclaim for further upside.
🔹 Breakout Dynamics:
The breakout above the wedge’s upper boundary was strong, driven by rising bullish volume and large-bodied candles, confirming that buyers have taken control.
Post-breakout, Bitcoin is now retesting the prior resistance zone — a classic technical behavior where previous resistance flips into new support (polarity change principle).
🔹 Volume Behavior:
Typical of a valid wedge breakout, we observed increasing volume at the breakout point, validating the strength and reliability of the move.
Strategic Trading Plan:
✅ Entry Zone:
Ideal long entries should be taken after confirmation of the retest around 93,000–95,000 USD.
Watch for bullish reversal candlestick patterns (e.g., bullish engulfing, hammer) or strong bullish momentum signals on lower timeframes during the retest.
✅ Target Projection (TP):
The theoretical target for this breakout is projected towards 105,135 USD, calculated using the widest part of the wedge and adding it to the breakout point.
This also aligns with a psychological barrier at 105K, where sellers may start taking profit.
✅ Stop Loss Placement (SL):
A conservative and logical stop loss is positioned below the major support zone at 77,675 USD.
This protects the setup against a deeper corrective move or a fakeout scenario.
✅ Risk-to-Reward (RRR):
The setup provides an excellent risk-to-reward ratio (approximately 1:3 or higher), making it favorable for swing traders and mid-term investors.
Market Psychology Behind the Setup:
Throughout the wedge, bearish momentum weakened — sellers were no longer able to push price lower with strength.
Accumulation occurred within the support range, signaling that strong hands were positioning themselves for the next major move.
The breakout represents the psychological moment when trapped short-sellers exit and fresh buyers enter, fueling the price higher.
Summary Table:
Element Details
Chart Pattern Falling Wedge (Bullish Reversal)
Trend Bias Bullish (Post Breakout)
Key Support 77,675 USD
Resistance Turned Support 94,000–95,000 USD
Entry Plan Breakout Retest Confirmation
Target Price (TP) 105,135 USD
Stop Loss (SL) Below 77,675 USD
Risk-to-Reward 1:3 or better
Conclusion:
Bitcoin has completed a technically clean breakout from a major Falling Wedge pattern, suggesting a significant bullish continuation. As long as price sustains above the 94,000 USD level, the market structure remains favorable for further gains toward the 105K target.
Traders are advised to monitor the current retest phase carefully and enter on clear bullish confirmations, respecting disciplined risk management at all times.
