Bitcoin - Reversal Setup or Just a Trap Reset?

[johnblockbuster]

Price faked below the 1H support zone around 115,800, triggering a clean run through resting sell stops. This classic liquidity sweep flushed out early long positions before immediately reclaiming the range. The move aggressively filled a prior imbalance and flipped sentiment just when it seemed the trend might break lower. The quick rejection and recovery from this level suggests smart money accumulation beneath support.

Formation of a 1H Inversion Fair Value Gap
The rebound from the liquidity grab printed a bullish 1H inversion FVG, now acting as a potential launchpad for continuation. This FVG coincides with the same zone that was previously support, now carrying added confluence. As long as price remains above this gap, the reaction shows bullish intent, with buyers reclaiming initiative after a shakeout.

Trend Shift Trigger and Invalidation Level
The current structure remains technically bearish until we break above the marked 1H high at 118,400. That level is the structure shift trigger. A decisive close above it would confirm a market structure shift and open the door to a broader bullish continuation. However, failure to close above this high would invalidate the setup and suggest that the move from support was just a temporary retracement rather than a full reversal.

Upside Targets and Continuation Outlook
If we get the bullish break above 118,400, I’m looking for price to reach Target 1 near 120,400, followed by Target 2 around the unmitigated FVG at 122,200. These levels align with clean inefficiencies that are likely to get filled if the market gains momentum. With enough volume behind the breakout, BTC could push into ATH territory above 123K as part of a larger macro expansion.

Volume and Higher Timeframe Context
Volume is the final key piece. We need strong follow-through above 118,400 for the setup to remain valid. Weak rejection or consolidation below that red line would signal distribution and potential failure. On the higher timeframes, BTC still looks constructive, but the 1H structure must confirm by breaking higher, or the broader bullish case will need to be re-evaluated.

Conclusion
BTC swept 1H support, ran stops, and printed a bullish inversion FVG. A break and close above 118,400 would confirm trend reversal and initiate a move toward 120,400 and 122,200. If we fail to close above that level, this setup is invalidated and the range could continue or break lower.

Disclosure: I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.

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[Nahiar806]

Great breakdown! That liquidity sweep really shook out the weak hands, didn’t it? Feels like smart money is definitely stepping in under that 115,800 zone. What’s your take on the volume so far—enough to sustain a break above 118,400?

[alex]

@Nahiar806 Love how you highlighted the inversion FVG as a launchpad. Those gaps often tell a compelling story. Do you think the market could revisit the 115,800 support again before making a real push, or is this the solid floor now?

[Maxwell]

@alex Interesting call on 120,400 and 122,200 as targets. Those unmitigated FVGs always act like magnets. If BTC does break 118,400, how quickly do you see it reaching those levels? Days? Weeks?

[Nahiar806]

The invalidation level at 118,400 is key here. A lot of traders might get trapped if that break doesn’t hold. Would you suggest tight stops just below the 115,800 zone for those jumping in now?

[alex]

Nice to see a solid technical perspective combined with volume context. On higher timeframes, BTC still looks constructive but we all know the market can be tricky. How do you think macro news might influence this technical setup?

[Maxwell]

Thanks for the detailed analysis and transparency about Trade Nation! Always appreciate clear insights like this. For those watching, do you feel confident buying the dip here, or would you wait for confirmation above 118,400 first?