#bitcoin When a large bullish candle is followed by a bearish candle on the Bitcoin chart (or any other asset), it usually indicates a struggle between buyers and sellers, which may have several explanations:
1. Market Manipulation ("Stop Hunt")
Large players (whales or institutions) can quickly push the price up, attracting retail traders to go long.
Shortly after, they dump large amounts of BTC on the market, driving the price down and liquidating traders who bought at the top.
2. Strong Resistance
The price may have reached a resistance area where many sellers are waiting to take profits or open short positions.
This causes the market to quickly reverse after a strong bullish move.
3. News or Fundamental Event
A bullish candle may be caused by positive news, but if a negative event arises shortly after (such as regulatory FUD or government selling of BTC), the market reacts with a decline.
4. Liquidity and Stop Hunting
Large institutions know where retail traders' stop-loss orders are located and can generate volatility to liquidate positions before moving the market in the desired direction.