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31.01.2025 07:38 PM
Analysis of Bitcoin through Smart money method

Hi, dear traders! Bitcoin has been trading sideways since November of last year. I have marked its borders between $90,928 and $108,272. Bitcoin could trade for an extended period within this range. The bears have been unable to apply significant pressure, causing Bitcoin to linger near the upper border of the range.

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Key market observations

1. Deviations and liquidity sweeps

Bitcoin has formed two deviations near the lower border—a sign of liquidity sweeps within the range. These deviations often indicate a reversal in the opposite direction. Within sideways movement, the 50% and 100% levels of the range serve as key targets.

Besides, two red lines highlight liquidity sweeps from the last two structural swings, signaling a further rise. This rise did occur, but it ended near the upper border of the range.

2. Bearish order block & resistance

Another key element is the bearish order block that formed between December 16–18. Price retested this area on January 7, and now this order block acts as a strong resistance zone, alongside the upper border of the range.

Bitcoin's sharp rally last week broke through the order block, but the sideways channel remained intact. A deviation formed at the top, sweeping liquidity from the December 17 peak, followed by a pullback—as I predicted.

However, the current decline remains weak, even though Bitcoin has reached the midpoint of the range.

3. Bullish order block & potential retracement

The third key factor is the bullish order block, formed by a single Shooting Star candlestick on January 13.

As we know, no financial instrument or currency pair is obligated to return to order blocks or imbalances. However, from a technical viewpoint, it would be ideal if Bitcoin first revisited this order block before initiating a new rally (if one occurs).

Order blocks are manipulative price movements designed to sweep liquidity. Large players open knowingly losing positions to accumulate positions in the opposite direction and often retest the order block to exit at breakeven.

Bitcoin could soon retrace to the $94,000 level. Within the bullish order block, traders may look for buy setups on the 1-hour chart.

However, an order block is not an unachievable wall—a break below it would signal a structural shift, potentially sending Bitcoin into an extended downward move.

Market Sentiment & News Calendar

The news flow on Friday was weak, exerting no significant impact on Bitcoin's price.

Key US economic events:

14:45 UTC – US Manufacturing PMI

15:00 UTC – ISM Manufacturing PMI

On February 3, the economic calendar contains two major events, one of which is highly significant. The US economic calendar will have a moderate impact on the crypto market in the second half of Monday's session.

Forecast & trading recommendations on BTC/USD

Bitcoin reversed near the upper border of the range and inside the bearish order block.

I expect further declines in the near term, with targets at $99,000 and $94,000. The first target has already been reached. If Bitcoin falls to the second target, it will complete the retest of the lower order block, after which:

Bitcoin could break out of the range through the upper border.

The bullish order block could be invalidated, leading to a structural breakdown and an extended decline

A deviation has formed near the upper border of the range —which typically signals a liquidity grab before a move in the opposite direction.

Since major swing points are where many traders place their Stop Losses, large players utilize these liquidity levels for accumulation.

For now, bears have no obstacles on their way down, and they collected sufficient liquidity on January 20 to continue pushing Bitcoin lower.

Samir Klishi,
Analytical expert of InstaForex
© 2007-2025
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