🧠 Introduction: Why This Chart Matters
Bitcoin recently provided a textbook example of market manipulation, where the price action formed a bullish-looking pattern (Pennant), trapped traders with a fake breakout, and then reversed strongly to the downside. By using Mirror Market Concepts (MMC), we can clearly see the logic behind this move—how the market mirrored a previous pattern and fulfilled a predictable target zone.
This analysis breaks it all down, step-by-step, for both educational and practical trading purposes.
🔍 Detailed Chart Breakdown:
1️⃣ The Illusion – Bullish Pennant Formation
Initially, BTC/USD formed what looked like a bullish pennant—a common continuation pattern in technical analysis. The pattern appeared after a sharp upward move, followed by converging trendlines suggesting consolidation.
Retail traders often anticipate a breakout above the pennant as a sign of bullish continuation. This is where the trap begins.
Why It’s a Trap: The pattern looked clean and reliable—but the context told another story. This move was designed to lure breakout traders into long positions right before a reversal.
2️⃣ The Fakeout – Liquidity Grab Above the Pattern
Shortly after the pennant formed, price pushed above the upper trendline, triggering breakout entries and stop losses of short-sellers. But instead of continuing up:
The price reversed sharply.
This aggressive move confirmed the fakeout.
This is a classic example of a liquidity hunt, where the market moves briefly in one direction to gather orders before executing the real move.
📌 MMC Insight: This behavior mirrors a prior setup—price previously faked upward, then dropped to a key demand zone. The mirror pattern gives a clue that the same outcome might repeat.
3️⃣ CHoCH – Change of Character Confirmed
After the fakeout, BTC broke below a key internal support and trendline structure, signaling a CHoCH (Change of Character)—a shift from bullish to bearish market control.
This moment is crucial:
It confirms the smart money’s intention.
It signals that the previous bullish move was just a setup.
Sellers now have control.
💡 Pro Tip: CHoCH is one of the earliest and most reliable signs of a reversal when combined with liquidity patterns.
4️⃣ Trendline Break & Structural Sell-Off
The break of the trendline following CHoCH solidified the bearish direction. This was the best confirmation-based entry point, as the structure flipped and began forming lower highs and lower lows.
5️⃣ Target Fulfilled – Previous Demand Zone Hit
The price then continued down aggressively and hit the marked MMC target zone. This area coincided with:
A previous demand zone (where buyers stepped in before).
A Mirror Market reversal point, seen earlier in the chart.
This fulfillment of the MMC target validates the entire analysis—from trap to reversal to target.
🎯 Key Zones:
Fakeout High: $69,600 area (liquidity sweep)
CHoCH Break Level: Around $69,100
Trendline Break Confirmation: $69,000
Final Target Zone: $68,500–$68,700
📈 Trading Strategy Recap:
Entry Idea: Enter short after CHoCH and trendline break
Stop Loss: Above fakeout high ($69,600+)
Take Profit: MMC demand zone ($68,500–$68,700)
This trade offered excellent risk-to-reward and confluence using multiple tools (MMC, CHoCH, structure, liquidity sweep).
🧠 What You Can Learn from This Setup:
Patterns Can Lie: A pattern like a pennant isn’t enough—context is key.
Liquidity Is King: Understand where the market needs to go to collect orders.
Mirror Market Concepts Work: Historical behavior often repeats in reverse. Use MMC to forecast likely outcomes.
CHoCH is Powerful: It's your early alert system for trend changes.
🔎 Final Thoughts:
This BTC/USD chart is a powerful example of how smart money operates—with manipulation, pattern traps, and mirrored market behavior. If you’re a price action trader or use MMC, this breakdown is a must-study.
Don't just trade patterns—trade context. Look for traps. Use MMC. Watch CHoCH. And always have a mapped target based on structure.
Bitcoin recently provided a textbook example of market manipulation, where the price action formed a bullish-looking pattern (Pennant), trapped traders with a fake breakout, and then reversed strongly to the downside. By using Mirror Market Concepts (MMC), we can clearly see the logic behind this move—how the market mirrored a previous pattern and fulfilled a predictable target zone.
This analysis breaks it all down, step-by-step, for both educational and practical trading purposes.
🔍 Detailed Chart Breakdown:
1️⃣ The Illusion – Bullish Pennant Formation
Initially, BTC/USD formed what looked like a bullish pennant—a common continuation pattern in technical analysis. The pattern appeared after a sharp upward move, followed by converging trendlines suggesting consolidation.
Retail traders often anticipate a breakout above the pennant as a sign of bullish continuation. This is where the trap begins.
Why It’s a Trap: The pattern looked clean and reliable—but the context told another story. This move was designed to lure breakout traders into long positions right before a reversal.
2️⃣ The Fakeout – Liquidity Grab Above the Pattern
Shortly after the pennant formed, price pushed above the upper trendline, triggering breakout entries and stop losses of short-sellers. But instead of continuing up:
The price reversed sharply.
This aggressive move confirmed the fakeout.
This is a classic example of a liquidity hunt, where the market moves briefly in one direction to gather orders before executing the real move.
📌 MMC Insight: This behavior mirrors a prior setup—price previously faked upward, then dropped to a key demand zone. The mirror pattern gives a clue that the same outcome might repeat.
3️⃣ CHoCH – Change of Character Confirmed
After the fakeout, BTC broke below a key internal support and trendline structure, signaling a CHoCH (Change of Character)—a shift from bullish to bearish market control.
This moment is crucial:
It confirms the smart money’s intention.
It signals that the previous bullish move was just a setup.
Sellers now have control.
💡 Pro Tip: CHoCH is one of the earliest and most reliable signs of a reversal when combined with liquidity patterns.
4️⃣ Trendline Break & Structural Sell-Off
The break of the trendline following CHoCH solidified the bearish direction. This was the best confirmation-based entry point, as the structure flipped and began forming lower highs and lower lows.
5️⃣ Target Fulfilled – Previous Demand Zone Hit
The price then continued down aggressively and hit the marked MMC target zone. This area coincided with:
A previous demand zone (where buyers stepped in before).
A Mirror Market reversal point, seen earlier in the chart.
This fulfillment of the MMC target validates the entire analysis—from trap to reversal to target.
🎯 Key Zones:
Fakeout High: $69,600 area (liquidity sweep)
CHoCH Break Level: Around $69,100
Trendline Break Confirmation: $69,000
Final Target Zone: $68,500–$68,700
📈 Trading Strategy Recap:
Entry Idea: Enter short after CHoCH and trendline break
Stop Loss: Above fakeout high ($69,600+)
Take Profit: MMC demand zone ($68,500–$68,700)
This trade offered excellent risk-to-reward and confluence using multiple tools (MMC, CHoCH, structure, liquidity sweep).
🧠 What You Can Learn from This Setup:
Patterns Can Lie: A pattern like a pennant isn’t enough—context is key.
Liquidity Is King: Understand where the market needs to go to collect orders.
Mirror Market Concepts Work: Historical behavior often repeats in reverse. Use MMC to forecast likely outcomes.
CHoCH is Powerful: It's your early alert system for trend changes.
🔎 Final Thoughts:
This BTC/USD chart is a powerful example of how smart money operates—with manipulation, pattern traps, and mirrored market behavior. If you’re a price action trader or use MMC, this breakdown is a must-study.
Don't just trade patterns—trade context. Look for traps. Use MMC. Watch CHoCH. And always have a mapped target based on structure.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.