Bitcoin is in another period of consolidation. The pending breakout could be huge.
The bearish rising wedge broke in the expected direction with a huge move to the downside from 97,000 to 60,000.
The new pattern is not as clear. Is is a bearing rising channel (bear flag), or is it a bullish ascending triangle.
The latter is normally a continuation pattern in an uptrend. But Bitcoin is not in an uptrend.
With fat crayons, I suppose one might draw another rising wedge out of this, but the cleanest technical draw is an ascending triangle.
A monthly view might make things more clear.
Bitcoin Weekly Chart
The weekly chart shows the rising wedge and a symmetrical triangle. The symmetrical triangle is a continuation pattern of the existing trend. That would imply lower.
The E-Wave weekly chart is also clean. Wave 5 down would be expected.
And if a big top is in, this could just be wave 1 down. By that, I mean waves 1-5 form a bigger wave 1. With Wave 2 up expected then wave 3 down, etc.
Wave 3’s or sometimes 5’s are the biggest waves. So if we are in a huge top setup, Bitcoin could easily crash all the way to 10,000 or even 1,000.
I won’t make any such calls. But my technical expectation is for 5 waves down now, then a rally. Five waves down would be to 50,000 which is also strong weekly support.
I have been accused of writing about Bitcoin after big moves. But this is the second time I have written in advance expecting a move lower.
Did Bitcoin “Digital Gold” Just Become Fool’s Gold?
On January 11, 2026 I asked Did Bitcoin “Digital Gold” Just Become Fool’s Gold?
In that post I discussed the fundamentals and the rising wedge. I expected a breakdown and a consolidation rally.
The breakdown happened, and so did a feeble rally. The technical pattern suggests another move down. So do the fundamentals.
Please click on the above link for further discussion.
Broke to the upside today like a rising tide, giving the rest a boost
If you are following the Feds new QE program you would see that since Dec 3rd, the Fed has injected a little over $110 billion. I expect that with the massive spend on the war, that dollar dilution will continue accelerating as this unfolds.
This suggests that bitcoin and other alternatives to the dollar will continue to find a bid despite a rush to liquidity.
The dollar will work “Until it doesn’t”. ,
US companies own about 95% of all the world’s corporately owned bitcoin. Microstrategy MSTR owns about 65% of that US corporate total, representing 52 billion dollars and 738,730 Bitcoins. MSTR has lost over 69% of its July 2025 peak valuation, a good indicator of Bitcoin’s valuation (Dutch Tulip) weather vane. The 5 day a week traded Bitcoin proxy, GBTC, is undergoing a 24 Feb 2026 6/13/13/8 day :: x/2-2.5x/2-2.5x/1.5x’ crash devaluation corresponding to the ACWI 25 Feb 2026: 5/13/13/8 day :: x/2.5x/2.5x/1.6x crash devaluation. Oil futures are undergoing a 26 Feb 2026 9/18/10-11 day :: x/2-2.5/1.5X’ blow-off secondary to the Hormuz closure. (Oil that has made it thru the gauntlet has been denominated in Yuan.)
My understanding is that recent rises in BTC have been down to one buyer pumping the market so any technical analysis isn’t based on normal rules.
About time the whole thing comes tumbling down. More interesting is the attempt to shore up the dollar using stable coin. Hoping that collapses too.
Bitcoin is fiat money for trendies and geeks.
So which government issued the decree for Bitcoin then?
maybe a time to buy an options spread?
BNPL – Bitcoin is a BNPL. Buy now and pay later stocks have the best corelation. These are stocks rely on liquidity. Liqidity from the consumer through earnings and easy credit rules. They also rely on insurance companies and private credit to buy up their generated obligations. The last boom in bitcoin(120K) I attribute to added availability of liquidity through an expending investment pool. The lastest drop is due to tightening liquidity and the rising risk premiums (less value and more sellers) in what other are willing to pay for risk. Any other corelation to any other index is because of its corelation to liquidity. AKA See Michael Howell.
If liquidity conditions improve(FED, Gold increasing and Govt spending) so will bitcoin. If liquidity contracts due to failed loans, tightening lending standards and demand destruction bitcoin will go down. My bet is we see the conditions improve through Govt and FED(80K) and shortly afterwards by 44K by loan failures. Powell and Fed may screw this up by thinking oil prices are going to drive inflation and not follow the 2 year treasury; This blunder will be the 2nd big screw up by Powell.
Agree, I’m with Lyn Alden on this, she had a great piece about how bitcoin is the best gauge of global liquidity. Someone asked why the USD was up during this chaos, it’s because liquidity is drying up and everyone needs dollars (i.e. sell Bitcoin or whatever and raise USD).
Not sure if that’s a third or a C wave down. It’s too shallow for a third.
In E-wave parlance, a corrective wave breaks down into ABC at the largest degree of pattern. Wave A and C may break down into 3 or 5 waves, but the structure (3 or 5 waves) of Wave C will always match that of Wave A.
I definitely would not not count wave 2 as a wedge since it only has 3 segments. wave 4 as drawn may eventually form a triangle (5 zigzags in a converging envelope).
My take is Bitcoin is going to take a full year to correct in a double zigzag e-wave. So far Wave A took 5 months (October 2025 high to February 2026 low). Wave B is at least a 2-4 month counter trend rally from February 2026 lows, followed by another 5-3 month crash.
Volume favors the character of Wave B, compared to that of proposed wave 2. A month after both started, there is much more volume in Wave B. The extreme negative reading at February’s lows without falling price is a huge contrarian signal. This negativity must dissipate before Wave C begins. Wave B’s are known as false starts to bull markets ( Wave B in the 1929 crash produced the song “Happy Times Are Here Again”). Similarly, the price will not move higher at the top of Wave B despite elevated optimism.
Corrected, the song title should have been “Happy DAYS Are Here Again”
“Throughout the ages, currencies have ceased to exist because of one rudimentary fact: governments are unable to resist the temptation to create free money for themselves.”
― Nik Bhatia
Trump: “people shouldn’t get upset about high gas prices we’re gonna get the Strait of Hormuz open…we’ll blow those Iranian mine ships to hell like no one has ever seen before”
People: “the reason it’s closed is because of you though?”
Trump: “Make Israel, I mean America, Great Again !!!, thank you for your attention to this matter.”
Coiled like the MOAD
(mother of all dumps)
What about the U$D?
For me, I did not expect starting a war in Iran to cause U$D to rise. Perhaps other did …my question “WHY did U$D rise?”
With a follow on – will U$D keep rising? and Why?
If you lived in the Middle East, knew Iran is harming every neighboring country, and it would take a currency debasement to rebuild countries; then wouldn’t you want to get your money out of the Middle East?
Investors are picking sides: China or the US as evidence by other countries’ currencies falling with respect to both of these currencies. China’s relative strength is due to dumping US Bonds.
Buy gold or gold miners. Bitcoin is pure speculation
It’s good for moving cash between countries and some fairly shady things, so I could see it getting used more during WW III, when all kinds of shady things are going on, and people are trying to flee countries.
Not that I want any bitcoin, myself.
I never understood the scarcity proposition. There is no barrier to entry for other crypto currencies. The bitcoin algorithm itself could be run a second time to create bitcoin 2.0.
On the other hand, no new elements are jumping out of the Periodic Table.
Bitcoins are like Yap stones… they have value because a lot of people agree that they do.
Now do the US dollar