Structural Review: False Breakout + False Breakdown = The Three Acts of Market Makers
✅ Phase One: False Breakout Luring Buyers (Bull Trap)
Professional Term: Bull Trap
👉 Refers to a brief rise in price after breaking above the previous high, misleading the market into thinking a new upward trend has begun, attracting retail investors to chase, followed by a quick price drop, forming a 'buying trap followed by a crash.'
📌 The red circle in the image is a typical Bull Trap:
The price briefly breaks above the previous high resistance zone, but the next day's close falls back below the key position, technically declaring the breakout a failure.
🔍 Purpose: Major players take the opportunity to distribute some chips at high levels, transferring floating positions and washing out retail investors who chase high prices.
✅ Phase Two: False Breakdown Washout (Bear Trap)
Professional Term: Bear Trap
👉 Refers to a quick pullback after the price breaks below a key support level, misleading the market into thinking a significant drop is imminent, triggering panic selling, while in reality, major players are taking the opportunity to accumulate.
📌 The yellow circle in the image: The price breaks below the key trading dense area marked in your chart, POC (Point of Control).
Term Explanation: POC (Point of Control)
The price level with the highest trading volume in the volume profile chart, usually represents a key cost area where major funds are actively trading, accumulating, or absorbing positions.
The current POC is near 104100 USDT.
📉 The bearish candle that broke below the POC was accompanied by increased volume, but the next day quickly recovered and stood back above the POC, forming a long lower shadow candlestick.
This is a typical false breakdown structure, intended to create panic and force some shorts to enter positions, providing liquidity for major players to further accumulate.
✅ Phase Three: Control Recovery + Approaching Previous High
Professional Term: Reclaim POC
👉 Refers to the price reestablishing itself in the major high trading cost area, indicating that the major players' control is still intact, and the market has not reversed to bearish.
📈 The current BTC price has reestablished itself in the 104100–107000 dense trading area, and a bullish structure has formed:
EMA5 crosses above EMA21, forming a bullish crossover of short-term moving averages.
RSI has risen back above the 50 midline, currently at 61.60, indicating a warming of momentum.
🔺 More importantly, the price approaches the previous high (red circle position), entering a critical resistance area. If it breaks out with volume, it will complete a platform breakout + double bottom structure.
