Bitcoin already broke out of the bearish structure a while back, and honestly, that was the first major shift everyone should have been paying attention to. Ever since that breakout, we have been building bullish structure on the higher timeframes, higher highs, higher lows, and overall strong momentum to the upside. This gave the bulls a clear advantage, and so far, nothing has really changed that bigger picture.
Consolidation Structure
Now, looking at the current price action, something important stands out. During the last big push up, Bitcoin left behind a massive daily imbalance zone. It is way too big to just leave open like that. Markets hate inefficiencies, especially ones of that size, and more often than not, these kinds of imbalance zones get filled at some point.
Because of that, I am fully expecting price to come down, revisit this imbalance area, and fill it properly before making any serious move higher. It is a natural thing for the market to do, clean up inefficiencies, grab liquidity, and then continue the main trend if the structure holds.
Bullish/Bearish Scenarios
The most important thing to watch here is how Bitcoin reacts once it gets into the imbalance zone. If we dip into it and then start seeing bullish reactions, I will be looking for confirmation that the bullish structure is still intact. Specifically, if we can avoid a daily candle close below the bottom of that imbalance, the bullish case remains valid.
However, if we get a full daily close below the imbalance, that would be a strong warning sign. That would tell me that the bulls lost control and we could be looking at deeper downside or a shift back into bearish conditions.
But as long as that does not happen, I am still looking for the market to respect the structure. A dip into the imbalance, hold, and then continuation higher, that is the ideal scenario.
