Trading = capital management under uncertainty.
Bitcoin is trading inside a clear descending channel on H4.
Price recently tested the upper boundary of this channel while forming a bearish divergence on MACD. This divergence hints at a weakening upward phase, signaling a possible phase shift according to Fractal Reversal Law (FRL).
Why is this a classic FRL setup?
✅ Phase Identification:
The prior local upward phase within the descending channel is weakening.
✅ Reversal Pattern:
A double top / wedge has formed at the upper boundary with a bearish divergence.
✅ Neckline:
The neckline aligns with the MA100 cluster on H4, now acting as a horizontal rubicon.
✅ Confirmation:
We wait for a full candle close below the neckline on H4 to confirm the phase shift.
✅ Targets:
– TP1: Mid-channel grey zone.
– TP2: Lower boundary of the channel.
✅ Stop:
Above the recent highs or channel top, depending on your risk management.
Plan:
Wait for H4 close below neckline → enter short.
Use the channel structure for target planning.
Manage risk with a tight, structure-based stop.
This is a clean FRL textbook scenario:
Phase → Pattern → Neckline → Confirmation → Target.
It aligns with the larger market structure, using the combination of price action, divergence, and structure clarity to guide your trade decisions.
Bitcoin is trading inside a clear descending channel on H4.
Price recently tested the upper boundary of this channel while forming a bearish divergence on MACD. This divergence hints at a weakening upward phase, signaling a possible phase shift according to Fractal Reversal Law (FRL).
Why is this a classic FRL setup?
✅ Phase Identification:
The prior local upward phase within the descending channel is weakening.
✅ Reversal Pattern:
A double top / wedge has formed at the upper boundary with a bearish divergence.
✅ Neckline:
The neckline aligns with the MA100 cluster on H4, now acting as a horizontal rubicon.
✅ Confirmation:
We wait for a full candle close below the neckline on H4 to confirm the phase shift.
✅ Targets:
– TP1: Mid-channel grey zone.
– TP2: Lower boundary of the channel.
✅ Stop:
Above the recent highs or channel top, depending on your risk management.
Plan:
Wait for H4 close below neckline → enter short.
Use the channel structure for target planning.
Manage risk with a tight, structure-based stop.
This is a clean FRL textbook scenario:
Phase → Pattern → Neckline → Confirmation → Target.
It aligns with the larger market structure, using the combination of price action, divergence, and structure clarity to guide your trade decisions.
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.
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.