$BTC

Is Bitcoin falling into a bull trap? ☠️

Bitcoin’s recent rally to $110,000 from $100,500 represents a similar setup from January 2025, when BTC prices rebounded to $102,700 from $91,700. The current observation reveals a compelling fractal pattern with potentially bearish implications. A fractal pattern is a repeating trend that could lead to similar price action due to identical market conditions. As illustrated in the chart, the pattern can be summarised in three similar signals: 

BTC price broke a descending trendline pattern after absorbing 3-4 weeks of trailing liquidity, and formed a bullish break of structure on the daily chart. 

BTC failed to take the previous high, which, in both cases, was the all-time high level. 

The relative strength index slipped below 50 before recovering and hit a rejection at 60.

Bitcoin fractal analysis on the 1-day chart. Source: Cointelegraph/TradingView

Bitcoin could face a sharp rejection if this fractal holds, potentially plummeting to $100,000, where significant support lies, as indicated by the chart’s liquidity zone. Validation of this fractal analysis requires the price to continue declining below Monday’s lows of approximately $105,000.

This raises the concern of a potential bull trap for BTC, where the crypto asset could signal the beginning of a multi-week drawdown. Invalidation would occur if Bitcoin reclaims and sustains above $108,000, negating the failed high and suggesting a bullish continuation.