Bitcoin is trading inside a compressing structure beneath a clean descending trendline. Price action has been choppy but controlled, creating multiple zones of inefficiency that remain unfilled.
We’re currently positioned between two major Fair Value Gaps, one above and one below, which gives us a clear roadmap. The broader market context suggests accumulation beneath key resistance, and the chart structure points toward a two-legged play before any breakout.
First Target: Upper Imbalance and Liquidity Trap
The first objective for price is to reach into the Fair Value Gap sitting just above current levels. This zone overlaps with the trendline and is backed by several wicks and failed breakouts, which likely means liquidity is built up there. Price may push through this area to trigger stop losses and induce breakout buying, only to reverse shortly after. The imbalance makes it an attractive magnet for price and a likely turning point once filled.
Retracement Move: Clean-Up Below
After sweeping the highs and filling the upper imbalance, price is expected to rotate back down. The area below holds an untouched Fair Value Gap from a previous bullish impulse, now acting as a demand zone. Once the upper inefficiency is filled, the market should drop into this zone to rebalance. This move will also help clear internal liquidity from the structure formed during the short-term rise.
Trendline, Inducement, and Execution Layers
The descending trendline plays a critical role here. With many traders watching it for a breakout or rejection, it acts as inducement. A false break or a touch just above the trendline may trigger entries in the wrong direction. The optimal move would be for price to react from the upper imbalance, reject at or just above the trendline, then fall into the lower zone, where we look for confirmation of reversal or continuation.
Final Expansion: Breakout After Cleanup
Once both Fair Value Gaps are filled and internal liquidity is cleared, Bitcoin will be in a clean position to rally. The area above the prior wicks and rejections is likely to hold significant liquidity, and the final move would aim to sweep that. This would complete the full cycle of imbalance fill, liquidity grab, and directional expansion. Price is unlikely to sustain a move higher until both zones have been addressed.
Conclusion
This setup focuses on efficient price delivery between key imbalances. Expect a short-term push up into the upper FVG and liquidity cluster, followed by a clean rejection into the lower demand zone. Once both sides are filled, Bitcoin should be ready for a real move higher, targeting liquidity above the current range. Let the market complete the cycle before looking for continuation.
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