The Great Immortal said: On December 16, Bitcoin soared to $106,000, reaching a new high! But be wary of the risk of a pullback!

With the market full of expectations for Trump's proposal to create a national Bitcoin reserve, and the optimistic anticipation of an interest rate cut by the Federal Reserve this week, Bitcoin surged past the $106,000 mark this morning, breaking the previous high set on December 5. Bitcoin has risen for seven consecutive weeks, marking the longest weekly winning streak since 2021. Since the U.S. election, Bitcoin has skyrocketed over 55%, with a gain of more than 14% in the past month. The market sentiment indicator, the "Fear and Greed Index," has soared to 83 points, entering the "Extreme Greed" zone, indicating that investors are extremely confident about future market trends.
However, the upward momentum of Bitcoin may face correction risks, especially as the pace of increase slows, which could mean increased short-term pullback pressure. As of the time of writing, it has retreated to $104,615, with a gain of about 2.75% in the last 24 hours.
Trump's friendly attitude towards cryptocurrencies has completely reversed the high-pressure regulatory atmosphere of the Biden administration, becoming an important driving force behind Bitcoin's rise. He not only proposed establishing a national Bitcoin strategic reserve but also declared that he wants to make the U.S. a leader in the global cryptocurrency industry, reigniting market expectations. This policy direction is undoubtedly a catalyst for Bitcoin to break new highs and will drive the cryptocurrency market into a new wave of excitement.
The Federal Reserve will hold an interest rate policy meeting on December 18, and the market generally expects a rate cut of 25 basis points (0.25%). If the interest rate decision meets expectations, it will further drive funds into the high-yield cryptocurrency market.
Bitcoin 4-Hour Chart

First, according to the Bollinger Bands indicator on the 4H Bitcoin chart, the current price is near the upper band, in the overbought zone, which means there is a risk of a pullback in the short term. The Bollinger Bands channel is expanding upwards, indicating that the market is generally in an upward trend, but the divergence between the price and the upper band is significant, making it prone to adjustments.
Second, according to the KDJ indicator on the 4H Bitcoin chart, the K-line and D-line values are already in the overbought zone above 80, while the J-line is at a higher position and starting to flatten. This situation indicates that the market is in an overbought area in the short term, and a pullback correction may occur subsequently.
Finally, according to the MACD indicator on the 4H Bitcoin chart, the DIF line and DEA line are above the zero axis, indicating that the market is still in a strong bullish phase. The MACD histogram is in red and gradually increasing, indicating strong bullish momentum. However, it is important to note that a divergence may occur at the top. If the MACD red histogram starts to shorten, it indicates that bullish momentum is beginning to weaken, and the price may experience a volatile pullback in the short term.
Bitcoin 1-Hour Chart

First, according to the Bollinger Bands indicator on the 1H Bitcoin chart, the price began to retreat after touching the upper band and is currently above the middle band. The Bollinger Bands are overall opening upwards, indicating that the market is in an upward trend. However, there is resistance after the price touches the upper band, showing signs of a pullback. In the short term, it may retest the middle band (104,000) for support. If the price stabilizes at the middle band, it is expected to continue pushing towards the upper band.
Second, according to the KDJ indicator on the 1H Bitcoin chart, the three KDJ values have turned down from the overbought area. Although a clear death cross has not formed, it also indicates that the market may face pullback pressure in the short term.
Finally, according to the MACD indicator on the 1H Bitcoin chart, the DIF line and DEA line have formed a death cross at a high level, indicating that short-term bullish momentum is weakening. The MACD histogram has also turned from red to green, indicating that market momentum is gradually weakening, and there may be pullback pressure in the short term.
In summary, the Bollinger Bands channel is still opening upwards, indicating that the overall trend remains upward. However, the MACD forming a death cross in the 1H level and the KDJ indicator being in the overbought area suggest that there may be some pullback pressure in the short term. It is crucial to pay attention to the support strength near the middle band (104,000) in the 1H level. If it effectively breaks below the middle band, it may further test the 103,000 level.
In conclusion, the following suggestions are provided for reference:
Suggestion 1: Short Bitcoin near 104,800, targeting 103,300-103,000, with a stop loss at 105,300.
Suggestion 2: Long Bitcoin near 103,300, targeting 104,000-105,000, with a stop loss at 102,800.
Time of writing: (2024-12-16, 17:30)
(Written by - Daxian Says Coin)