Bitcoin Cash distribution underway (4H)

Jan 13

As discussed in our previous analysis, we identified a bullish diametric structure on Bitcoin Cash. That structure has now fully matured, with the final leg — wave G — reaching completion. According to Elliott Wave and complex corrective behavior, the completion of wave G in a diametric often signals trend exhaustion, and at this stage the market typically transitions into a corrective or impulsive move in the opposite direction.

At the current price location, market structure suggests that BCH is preparing to form a bearish wave, rather than continuing higher. This expectation is not based on a single signal, but on confluence.

Trendline Break & Shift in Control
A short-term ascending trendline, marked clearly with a dashed line on the chart, has now been broken to the downside. This breakdown is important because it represents a loss of bullish momentum and confirms a shift in market control.

When price fails to respect a short-term trendline after completing a higher-degree structure (like a diametric), it often means that buyers are no longer willing to defend higher prices, while sellers are becoming increasingly aggressive. In simple terms:
➡️ Sellers are now stronger than buyers.

Market Maker Perspective – Why Price Moves Like This

From a market maker perspective, this behavior makes perfect sense. After completing wave G, price typically enters a zone where liquidity above the highs is harvested. Market makers often push price slightly higher or keep it ranging to:

Trigger late long entries
Run stop-losses above resistance
Create the illusion of continuation

Once sufficient liquidity is collected, price is then distributed and pushed lower. This is why we often see:
Fake breakouts
Slow grinding price action near highs
Sharp bearish moves after structure completion

In this case, the diametric completion combined with the trendline break strongly suggests that distribution has already occurred, and the market is now transitioning into the markdown phase.

Trade Execution – DCA Entries
We have identified two clear entry zones for this setup. Rather than entering with full size immediately, the plan is to scale into a sell/short position using DCA (Dollar Cost Averaging).

This approach:
Reduces emotional decision-making

Protects against short-term market maker wicks

Aligns with how smart money builds positions

Patience is key here. Market makers often attempt one last push to shake out early shorts before the real move begins.

Targets & Expectations
All targets are clearly marked on the chart for transparency and planning purposes. While intermediate targets exist, the primary target is the green zone, which represents:

A high-probability liquidity area

Structural support

A logical termination zone for the bearish leg

This area is where we expect profit-taking and potential reaction.

Invalidation Level – Risk Management First
No analysis is complete without a clear invalidation point.
If a daily candle closes above the invalidation level, this entire bearish scenario will be invalidated.

A daily close above that level would indicate:
The diametric structure is no longer respected

Market makers are targeting higher liquidity zones

Bias must be reassessed objectively

Until that happens, the bearish bias remains valid.

Final Notes for Traders
This setup is not about prediction — it’s about structure, liquidity, and behavior.
When structure completes, trendlines break, and liquidity aligns, the probabilities favor a directional move.

Trade with discipline, respect your invalidation, and remember:
Market makers move price to where the most pain exists — not where the crowd expects it.

Jan 18

Trade active

After hitting the entry points, it dumped by more than 6% 🔽, and both the first and second targets were reached.