Bitcoin continues to correct and is moving slowly toward the only "bearish" FVG on the daily chart. In recent weeks, the price has been primarily moving toward this pattern, and Bitcoin is clearly indicating it is preparing for a new decline. It is important to remember that the correction can finish at any moment, not necessarily within any pattern. Currently, there are no signs of an end to the bearish trend that began last year. The fundamental backdrop remains negative for the cryptocurrency segment: the Federal Reserve does not intend to lower the key rate in 2026, capital continues to flow into the AI sector, spot demand for Bitcoin remains weak, geopolitical tensions are unstable, miners are repurposing their equipment for AI needs, and Strategy continues to sell Bitcoin reserves. We see no reason for significant growth in "digital gold."
Meanwhile, it has become known that Strategy raised over $300 million through the sale of preferred shares, but for the first time in a long time, it did not spend a single dollar on purchasing Bitcoin. Recall that for the past six years, Strategy has solely bought "digital gold" "with all its money." This strategy has led not only to significant unrealized losses (as the current price of the first cryptocurrency is significantly lower than the average purchase price of Strategy), but also to liquidity problems. As a result, the company's management has decided to start selling "digital gold." As we can see, the funds raised are now directed toward replenishing dollar reserves, paying dividends, or repurchasing shares. It is also worth noting that the change in Strategy's approach has not led to a significant rise in its stock price. For example, the preferred shares are still trading below their par value. The company continues to hold about 840,000 coins, but we believe that over time, Bitcoin reserves will be reduced. Bitcoin shows no sign of rising, and Michael Saylor's company has long been associated exclusively with Bitcoin investments.
Overall Picture of BTC/USD on 1D:
On the daily timeframe, Bitcoin continues to form a downtrend. The trend structure is identified as bearish, and the CHOCH line is at $82,800, as a new LL (Lower Low) formed. Only above this level can we consider that the downward trend is over. As there are still no signs of an upward trend reversal, we believe the decline will resume once the current correction concludes. A bearish FVG has formed in the $68,000–$70,700 range, which serves as the only POI (Point of Interest) for sales. Additionally, around this pattern is a liquidity pool in the form of two nearly equal highs. The execution of the FVG may coincide with the removal of liquidity, thereby strengthening the sell signal.
Trading Recommendations for BTC/USD:
Bitcoin continues to form a full-fledged downward trend. We still expect a decline toward $57,500 (the 61.8% Fibonacci level of the three-year upward trend), although this level has already been tested. However, we do not consider that the downward trend is over. The last bearish FVG formed in the $68,000–$70,700 range on the daily timeframe, so this area serves as the POI for short positions in the coming weeks. On the 4-hour timeframe, Bitcoin has bounced upward again, but movements are likely to remain choppy and "swing-like." Traders may consider trade setups based on local patterns, but we would not expect strong movements at this time.
Explanations for the Illustrations:
- CHOCH – Change of Character in trend structure.
- Liquidity – Liquidity, stop losses, pending orders that market makers use to accumulate their positions.
- FVG – Fair Value Gap. Price moves very quickly through these areas, indicating a complete absence of one side in the market. Subsequently, prices tend to return and react to such areas in the direction of the main trend.
- IFVG – Inverted Fair Value Gap. After returning to such an area, the price does not receive a reaction; instead, it breaks through impulsively and then tests it from the other side.
- OB – Order Block. A candle on which the market maker opened a position to gather liquidity to form its own position in the opposite direction.
