From panic to greed, can BTC hold above the 52-week moving average | Special Analysis

This week, the BTC sentiment index has jumped from "Extreme Fear" to "Extreme Greed," but the price remains unsteady near the 52-week moving average (approximately $81,700). Neither of the two criteria for the pullback confirmation mechanism has been met—this is an oversold rebound, and it is too early to declare a bull market. From a Chan Theory perspective, the daily-level endpoint 5 is in the final phase of leaving consolidation zone A. Close attention should be paid to the construction node of the second upward consolidation zone B. Meanwhile, HYPE has also entered the construction phase of consolidation zone B, with short-term focus on stabilization signals in the $73–77 support zone.

1. Analysis of the Current Nature of Bitcoin's Market

1. Market Sentiment Index: Shifted from "Extreme Fear" to "Extreme Greed"

As seen from the sentiment index above: after nearly two months of rebound, especially the accelerated rally over the past two weeks, market sentiment has undergone a fundamental reversal. The market's perception of the nature of this rebound has changed, with a growing number of views leaning toward a "bull market return" assessment. Below, we will outline our core judgment on the current market stage from a technical perspective.

2. Historical Data Regression and the 52-Week Moving Average Confirmation Mechanism

Figure 1: Bitcoin Weekly K-line Chart

Based on the weekly timeframe, our retrospective analysis of nearly 9 years of historical data reveals that every significant trend reversal in the market (i.e., bull-bear cycle transitions) can be confirmed using a quantitative indicator: the 52-week moving average. This average possesses strong noise-filtering capabilities for medium-to-long-term trends and serves as a watershed for distinguishing bull from bear markets. To enhance the executability of this indicator, we have broken it down into two quantitative confirmation criteria:

① Position Status (Trend Direction Assessment)

•  Bull market environment: Price consistently operates above the 52-week moving average, with the average's slope turning upward;

•  Bear market environment: Price consistently operates below the 52-week moving average, with the average's slope diverging downward;

•  Transition/Consolidation: Price repeatedly crosses back and forth around the average, with the average flattening (the absolute value of the slope converging within a threshold).

② Breakout/Breakdown Confirmation Period (Filtering False Signals)

•  Valid breakout (bear to bull): Weekly closing prices hold above the moving average for 2-3 consecutive weeks. A single week's penetration followed by a pullback is considered a false breakout and is not confirmed;

•  Valid breakdown (bull to bear): Weekly closing prices close below the moving average for 2 consecutive weeks. A single week's wick is not confirmed.

3. Assessment of the Current Market Nature

Based on the aforementioned quantitative standards for bull-bear transitions: the current price has approached the 52-week moving average (approximately $81,700) but has failed to break through effectively, and the average is still in a downward phase. Against the confirmation mechanism, a bull market requires prices to hold above the average for two consecutive weeks with the slope turning upward—neither of which is currently satisfied. Therefore, we believe that the current BTC market remains an oversold rebound in nature, and it is too early to declare a bull market. The market overall is in a transition and confirmation period.

2. Analysis of Bitcoin's Daily-Level Price Structure

Figure 2: Bitcoin Daily K-line Chart

In the previous weekly review in this column, we systematically analyzed and positioned the rebound structure of BTC that began from the July 1 low of $57,820 using Elliott Wave Theory. This week, we introduce the Chan Theory framework to provide a multi-dimensional restatement and cross-validation of the same rebound. Our aim is to deepen readers' understanding of the evolutionary path and trend nature of the current market structure through mutual corroboration and cross-examination of different technical systems, thereby building a more three-dimensional and objective market analysis framework to assist in future assessments.

1. As shown in (Figure 2): The rebound initiated from the July 1 low of $57,820 has clearly presented a five-segment rebound structure from (0-1) to (4-5) on the daily level; among these, segments (1-2), (2-3), and (3-4) overlap, forming the first upward consolidation zone of this rebound (i.e., Consolidation Zone A) as per the rules; the current price is operating in the departure segment (4-5) leaving Consolidation Zone A.

2. Comparing momentum within Consolidation Zone A: the comparison of upward strength between its entry segment (0-1) and departure segment (4-5) shows that the departure segment's rebound strength is significantly greater than the entry segment, with no momentum divergence between the two. Based on this, it can be inferred that after segment (4-5) concludes, the market will likely enter a 2-3 week wide-ranging consolidation, constructing a second upward consolidation zone (i.e., Consolidation Zone B). Once construction is complete, a departure segment leaving Consolidation Zone B will commence, which is expected to temporarily hold above the 52-week moving average and further challenge the key resistance level of $82,850, marking a new rebound high. We will track and assess at that time.

3. Bitcoin's Weekly Market Forecast and Trading Strategy

1. BTC Weekly Market Forecast

Core view for this week: Closely monitor the termination point of "Endpoint 5" on the daily chart, as well as the potential construction of the second upward consolidation zone.

2. Key Resistance Levels

   • First resistance zone: $81,700–$82,850 (key previous level)  

   • Second resistance zone: Near $84,500 (key previous resistance area)  

   • Third resistance zone: $90,000 area (key psychological level)

3. Key Support Levels

   • First support level: $73,500–$75,000 area (key previous support level)     

   • Second support level: $67,300–$69,100 area (key previous support level)                         

4. This Week's Trading Strategy (Excluding Impact of Unexpected News)

① Medium-term strategy:

Figure 3: Bitcoin Daily K-line Chart (Position Monitoring Model)

Position Monitoring Model: As shown in (Figure 3), the current price has effectively broken through the "long/short channel," and the market structure has changed in the short term. The current medium-term position is zero, and we maintain a cash-only wait-and-see stance for now.

② Short-term strategy: Utilize 30% of position with a stop-loss set, and seek "spread" opportunities based on support and resistance levels (using 30-minute/60-minute charts as the operating timeframe).

③ For short-term operations, to dynamically adapt to complex market evolution, we have prepared the following operational plan in advance.

• Light long positions at strong support zones.

   • Entry: When the price pulls back to the first or second key support level mentioned above, shows a clear stabilization pattern, and the quantitative model simultaneously issues a bottom signal, a long position of approximately 30% can be established.

   • Risk control: Set an initial stop-loss.

   • Exit: When the price rebounds to key resistance levels combined with model signals, gradually close positions to lock in profits.

4. HYPE Price Structure Analysis

Figure 4: HYPE 4-Hour K-line Chart

1. On the 4-hour timeframe: The upward move initiated from the August 2 low of $51.11 has been clearly broken down into a nine-segment upward structure from (72-73) to (80-81); among these, segments (73-74), (74-75), and (75-76) overlap, forming the first upward consolidation zone (i.e., Consolidation Zone A).

2. Analyzing the upward momentum within Consolidation Zone A: the comparison of upward strength between its entry segment (72-73) and departure segment (78-79) shows that the departure segment's upward strength is significantly greater than the entry segment, with no momentum divergence between the two. Therefore, after segment (78-79) concludes, the currently ongoing segments (79-80) and (80-81) are likely constructing a second upward consolidation zone (i.e., Consolidation Zone B). Once Consolidation Zone B construction is complete, a departure segment leaving Consolidation Zone B will commence.

5. HYPE Weekly Market Forecast and Short-term Trading Strategy

1. HYPE Weekly Market Forecast

① Key resistance levels:

• First resistance level: Around $87–$90

② Key support levels:

• First support level: Around $77;

• Second support level: Around $73;

Core view for this week: Focus on the node where Consolidation Zone B completes its construction.

2. HYPE Short-term Trading Strategy for This Week

Short-term operations this week:

① For those holding long positions: If you have established long positions in the $50–$52 area according to the previous trading plan, it is recommended to move the initial stop-loss up to around $70 to protect existing profits, strictly adhere to stop-loss discipline, and hold positions for further gains.

② For those with no positions: If the price pulls back to the key support zone of $73–$77, stabilizes, and issues a clear buy signal, consider establishing light long positions, with a stop-loss set and strictly executed.

6. Special Reminders

 1. At entry: Immediately set an initial stop-loss.

 2. When profit reaches 1%: Move the stop-loss to the entry cost price (breakeven point) to ensure capital safety.

 3. When profit reaches 2%: Move the stop-loss to the position where profit is 1%.

 4. Continuous tracking: Thereafter, for every additional 1% profit, the stop-loss moves up by 1% accordingly, dynamically protecting and locking in gains.

The financial market changes rapidly, and all market analyses and trading strategies require dynamic adjustments. All views, analytical models, and trading strategies presented in this article are derived from personal technical analysis and serve solely as a personal trading journal. They do not constitute any investment advice or operational basis. The market carries risk; invest with caution, and do not make decisions based solely on this content.