BTC/USD Short Trade Setup Analysis (1D Timeframe - Bitstamp)📍Currently, Bitcoin is showing signs of a potential rebound, but technicals suggest we are not yet at a confirmed reversal. We can see how BTC has recently broken below the ascending channel hitting a low of $78,000 which was very close to out $75,000 target. While it is possible for a sharp rejection up and beyond previous highs, it is unlikely. We anticipate that Bitcoin is testing the broken channel as resistance before falling lower towards our $75,000 target over a period of months (potentially 6 months) consolidating in an tighter range until a direction is determined.
This latest move upwards by Bitcoin and the trailing market is the result of the Trumps crypto reserve statement. The market seen a surge after his remarks, but this will be short lived because nothing has actually changed:
Size of the Reserve:
No official size has been confirmed, but proposals vary. Senator Cynthia Lummis suggests acquiring 1 million Bitcoins over 20 years (about 5% of total supply). Trump’s March 2, 2025, announcement named Bitcoin (BTC), Ethereum (ETH), XRP, Solana (SOL), and Cardano (ADA) for inclusion but didn’t specify amounts. The government currently holds ~200,000 Bitcoins (worth ~$18–21 billion) from law enforcement seizures, which could form the basis of the reserve.
Timeline for Filling the Reserve:
Lummis’ proposal outlines a 20-year timeline to acquire 1 million Bitcoins (200,000 per year). Trump’s January 2025 executive order tasked a working group with evaluating the reserve within 180 days (by July 2025), but no specific timeline for filling it was provided. Posts on X speculate on faster timelines, but these lack official confirmation and are inconclusive.
Is It Actually Going to Happen?
The proposal is still exploratory, not finalized. Trump’s executive order and March 2 announcement show intent, but congressional approval is likely needed for major purchases or funding beyond seized assets. Experts like Nic Carter (via web sources) doubt a “true” reserve will pass Congress due to economic and political opposition. Posts on X show mixed sentiment—some bullish, others skeptical—but no definitive action has occurred.
Can Trump Make This Happen Unilaterally?
No, Trump cannot create or fund a large-scale reserve alone. The executive order allows evaluating and potentially using seized assets (~200,000 Bitcoins), but expanding it (e.g., to 1 million Bitcoins) requires congressional legislation and funding. Some argue the Treasury’s Exchange Stabilization Fund could be used, but legal experts and posts on X suggest significant hurdles remain, including Federal Reserve and congressional oversight.
This push in price is driven by hype, fomo and retail traders not understanding the market.
Current Outlook:
Risk/Reward = 1:12.5
📉 Bearish Scenario (Anticipated outcome)
- ❌ Invalidation Level: Above $100,000
- 🔻 Downside Targets:
Bitcoin appears to be testing the recent break of the parallel channel. We expect to see Bitcoin fall to test previous structure high, which lines up with the 61.8% fib at $75,000.
✅ Justification:
- Bitcoin remains in a long-term bullish trend, however given the recent break below the parallel channel, we are currently still bearish whilst it remains below $100,000.
- Bitcoin / the market have seen strong bullish moves since Trump became president, with "positive" news coming frequently. However, upon deeper inspection, this positive news lacks sustenance, and will likely be deflationary over the coming weeks and months as traders begin to realise that nothing has changed.
⚡ Key Takeaways:
- 🔹 Bitcoin has broken the parallel channel to the downside, hinting at a potential further drop.
- 🔹 The recent break of the channel is usually followed by a test of broken support, to be confirmed as resistance before falling lower. We believe this is what we are seeing now.
- 🔹 Bitcoin still remains in a long-term bullish direction, so we will take shorts when appropriate, with tight stops at invalidation levels mentioned above.
- 🔹 Expect price to fall from here, down towards $75,000 over the next few weeks / potentially months of consolidation.
Bullish invalidation:
- 🔹 If Bitcoin breaks above $100,000 we can consider a long, targeting $110,000. With a stop placed below the lower support of the ascending channel. We must wait for candle closes before entering.
❗Fundamental Outlook:❗
📍The recent macroeconomic environment, including U.S. monetary policy shifts and global adoption of Bitcoin, has significant implications for its price.
❗1. U.S. Monetary Policy and Inflation Concerns
The Federal Reserve’s cautious stance on interest rates in early 2025, coupled with persistent inflation fears, has driven investor interest in Bitcoin as a hedge against fiat currency devaluation. Lower interest rates or quantitative easing could further bolster Bitcoin’s appeal as a store of value.
❗2. Institutional Adoption and ETF Inflows
Major financial institutions and Bitcoin ETFs have seen record inflows in 2025, with companies like BlackRock and Fidelity increasing their exposure. This institutional buying pressure supports a bullish outlook for Bitcoin, as it signals growing acceptance of cryptocurrencies in traditional finance.
❗3. Geopolitical Uncertainty
Ongoing geopolitical tensions, such as U.S.-China trade disputes and regional conflicts, have increased demand for decentralized assets like Bitcoin, which are seen as immune to government interference or currency controls.
❗4. Halving and Supply Dynamics
Although the most recent Bitcoin halving occurred in 2024, its effects on reducing new supply continue to tighten market dynamics, potentially driving prices higher as demand outpaces supply growth.
Fundamental Analysis Conclusion
📍Macroeconomic uncertainty, institutional adoption, and Bitcoin’s supply dynamics create a bullish environment for its price.
📍Geopolitical risks and inflationary pressures reinforce Bitcoin’s role as a digital store of value, supporting upward price movement.
📍Growing ETF inflows and institutional interest suggest sustained buying pressure in the near term.
Outlook: Mixed signals for Bitcoin direction
📈Given the combination of macroeconomic tailwinds, institutional adoption, and Bitcoin’s unique supply characteristics, the fundamentals point toward continued strength in Bitcoin prices. However, many of these fundamentals on the surface appear to point towards the bulls, but we must be cautious of trading what you hear, vs what you see. Technically, bitcoin is bearish in the shorter term, unless it breaks back above $100,000.
