Bitcoin’s weekly chart is flashing a rare trifecta that traders can’t ignore: a rising wedge nearing completion, multi-indicator bearish divergence, and price stretched well above the 200-week MA. After tagging a year-to-date high near $126,200, BTC has slipped to roughly $109,500, and the technicals suggest the next leg could be decisive—potentially dragging price toward the high-$50Ks before any meaningful rebound.

What’s happening now

BTC rolled over more than 10% from its 2025 peak and is pressing the lower band of a weekly rising wedge that began forming after price cleared the key $105,000 level in December. Wedge breakdowns often occur near trendline confluence—precisely where BTC is now. The measured move from the wedge’s widest point (~45%) projects a downside target near $58,890.

Why this matters to traders

Price remains well above the long-term anchor, the 200-week moving average near $64,786. That gap increases the odds of a classic mean reversion. Momentum has also diverged: RSI, TSI, and PPO are pointing lower while price advanced—textbook bearish divergence that often precedes trend fatigue.

Context matters: BTC has survived deeper drawdowns—about 55% in 2021, 34% into April this year, and 77% in 2022—before recovering. But “it bounces eventually” isn’t a strategy. Traders need levels, triggers, and risk controls now.

Actionable game plan

• Map key levels: Support zone: $64,786–$60,000; measured target: $58,890. Invalidation for the bearish thesis: a weekly close above $126,200 with rising volume.
• Wait for confirmation: A weekly close below wedge support + momentum breakdown (RSI losing 50, PPO crossing down) strengthens the short-term bearish case.
• Risk management: Size positions for volatility. Use stop-losses just beyond invalidation zones—not arbitrary round numbers.
• Hedging approach: Long-term bulls can hedge with small perp shorts or protective puts if available, reducing downside without abandoning core holdings.
• Scale tactics: For spot accumulators, consider staggered bids in the $62K–$59K area, widening spacing as volatility expands.
• Watch catalysts: Funding flips, liquidity conditions, macro prints (rates/inflation), and ETF flows can accelerate or negate the move.

Key risks and the alternative path

Patterns fail. A sharp reclaim and weekly close back above $126,200 would negate the wedge breakdown and could squeeze shorts fast. Also watch for a bear trap: a brief wick below wedge support without momentum confirmation can snap back violently. Macro surprises—policy shifts, spot ETF inflows, or risk-on liquidity—can override clean technicals.

Bottom line

The setup favors a controlled pullback toward $60,000—with a measured risk of $58,890—unless BTC invalidates above $126,200. Prepare scenarios, not predictions: define levels, confirm signals, and let risk management do the heavy lifting.

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