Hold the mid-term short position in Bitcoin, HYPE successfully rides the waves for profit | Special Analysis

Hello everyone, I am Cody, an invited analyst from Odaily Planet Daily. Wishing all my readers a happy Lantern Festival in advance!

Looking back at last week’s Bitcoin market, the overall trend mostly followed the previously established trading framework and rhythm. In the short-term strategy, market movements and short-term judgments aligned closely, leading to a short position (1x leverage) with a profit of approximately 2.12% on a single trade (see Table 2). For the medium-term strategy, Bitcoin continued to follow the prior mid-term approach, holding a short position at $89,000 (1x leverage). As of last week’s close, the price retreated to about $65,770, with an unrealized profit of approximately 26.10%, and a maximum floating profit of about 32.58% during this period.

From a market analysis perspective, Bitcoin last week remained in a weak oscillation range, consistent with our previous assessment of the C-2 wave rebound phase, indicating that the short-term rebound nature has not changed.

Additionally, I remain optimistic about HYPE’s prospects, so this week’s report continues to track and analyze HYPE’s multi-cycle trend structure. Last week, based on my own short-term analysis, I executed a long position (1x leverage), achieving a profit of about 11.14%, which aligns well with the trading logic and execution results (see Table 1).

Below, I will provide a more detailed explanation of the market forecast, strategic logic, trade execution, and review of results.

1. HYPE Trend — Prelude to Wave III?

In my weekly review on February 22, I first highlighted the investment opportunity in HYPE, clearly indicating that its previous downtrend might reverse. The current market is in the Wave II correction after the Wave I rally, with a potential for a main upward move (Wave III) in the near future. The core basis for this judgment includes: (see Figure 2)

• During the Wave I rally, the price successfully broke through the long-term downtrend line connecting the September 2025 high (~$59.48) and the October 2025 high (~$50.17) (blue line in the chart);

• At the starting point of Wave I, our self-developed momentum quantification model issued a daily-level divergence signal;

• At the same point, our price spread quantification model triggered a strong bottom warning signal (white bar in the chart).

It’s worth noting that the validity of these two models’ signals has been confirmed by the market’s strong upward movement during Wave I.

1. Short-term HYPE Trading Review (1x leverage): (02.22–03.01)

Last week, we strictly followed the signals from our spread trading model and momentum quantification model, combined with our forecast of Wave III’s main upward trend, to complete a short-term long position, achieving a profit of approximately 11.14%.

(See Table 1)

• Summary of short-term HYPE trading (1x leverage):

Table 1

• Entry decision (see Figure 3): Based on the forecast of the main upward trend; simultaneously, the spread quantification model issued multiple bottom warning signals (red dots), which resonated with the momentum quantification model’s bottom signals; after the price broke through key previous resistance zones and stabilized, a long position was opened at $27.28.

• Exit decision: When the spread and momentum models issued top resonance signals, the position was closed near $30.32.

• Trade summary: This operation successfully captured the early stage of Wave III’s rally, with a profit of about 11.14%.

HYPE 30-minute candlestick chart:

Figure 1 (Short-term trading illustration)

2. Initial structure analysis on the daily chart: (based on market evolution after January 21)

HYPE Daily Chart:

Figure 2

• Wave I (Driving Wave): Started at the low of $20.46 on January 21, peaked at $38.41 on February 3. Duration: 14 days, with a maximum increase of 87.73%, forming the first major driving wave of this rally.

• Wave II (Correction Wave): Began at the February 3 high of $38.41 and ended at the February 24 low of $25.60. Lasted 20 days, retracing 33.35% of Wave I.

• Wave III (Potential Driving Wave): Started from the February 24 low of $25.60 and is currently ongoing. The third driving wave is often the most explosive.

• Confirmation of Wave III’s initiation: The current trend shows several technical features consistent with the early stage of a strong driving wave:

a. Breakthrough of key resistance: Price successfully broke through an important resistance line since Wave II’s correction (yellow line in the chart), which had been challenged three times unsuccessfully previously. This indicates a shift in the battle between bulls and bears.

b. Strong momentum validation: The rebound from the February 24 low, which took only 6 days, fully covered the previous 10-day decline. Notably, the large bullish candle on February 28, with a 14.25% increase, demonstrates significant strength, characteristic of initial momentum in Wave III.

c. Structural trend reversal: The recent high surpasses two key points near the Wave II correction: the high of February 21 at $30.59 and the low of February 19 at $27.73. This suggests a “higher high” trend, indicating that the previous downtrend has been fundamentally reversed.

• Confirmation of Wave III’s high point: The peak of Wave III must exceed the Wave I high of $38.41. Otherwise, the current move may still be a broad-range rebound within a sideways or downward correction.

3. HYPE 4-hour detailed wave structure

HYPE 4-hour chart:

Figure 3

In Figure 3, we further subdivide the daily wave structure into finer segments.

• Wave I internal structure: Divided into five segments: 0-1, 1-2, 2-3, 3-4, 4-5, forming a complete upward sequence.

• Wave II internal structure: Divided into seven segments: 5-6, 6-7, 7-8, 8-9, 9-10, 10-11, 11-12, forming an orderly correction.

• Wave III internal structure: Currently unfolding, roughly divided into three segments: 12-13, 13-14, 14-15, with the upward segment 14-15 still ongoing.

Second, reviewing Bitcoin — Range oscillation as the main pattern: (02.22–03.01)

1. Short-term trading strategy review: (see Table 2)

We strictly followed the signals from our spread trading model and momentum quantification model, combined with our market forecast, to execute a short-term short position, earning a profit of 2.12% last week.

① Bitcoin short-term trading details (1x leverage):

Table 2

② Trade review: (see Figure 4)

• Entry: Rebound encountered resistance at the descending trendline, while the spread trading model triggered a top warning (green dot). Combined with two model’s short signals, a 15% short position was established at $68,876.

• Risk control: initial stop-loss at $72,000.

• Exit: When the price fell near support, with bottom signals from the models and candlestick reversal patterns, all positions were closed at $67,415.

• Summary: This trade yielded a profit of 2.12%.

Bitcoin 30-minute candlestick chart: (Momentum quantification + spread trading models)

Figure 4 (Short-term trading illustration)

3. Bitcoin indicator analysis — Weekly and daily comprehensive review

Weekly level: Medium-term bearish trend persists

From the weekly perspective, the momentum indicator’s momentum line continues downward, with the negative volume bars shrinking temporarily but not forming a clear divergence, so the bearish trend remains intact. The sentiment quantification model shows the market has not entered an oversold panic zone, and bottom sentiment recovery conditions are not yet met; similarly, the digital monitoring model has not confirmed a bottom.

Structurally, last week’s weekly candle closed with about a 2.76% decline, breaking below the previous triangle consolidation, with the price’s center of gravity shifting downward, consistent with a bearish continuation pattern, indicating the medium-term outlook remains weak.

Daily level: Oversold rebound continues but with limited momentum

On the daily chart, the market remains in a sideways oscillation. The momentum line, after a “golden cross” below zero, shows slight upward movement, indicating short-term rebound momentum is being released. However, the positive volume bars are disordered and lack persistence, making the rebound weak.

Emotion indicators, while slowly recovering from oversold levels, show limited participation from funds, with bulls and bears mostly watching, making a trend unlikely in the short term.

Multi-cycle comprehensive view

Overall, both weekly and daily analyses suggest Bitcoin remains in a dominant downward structure. The daily rebound appears to be a technical correction within a downtrend, and until the weekly trend is effectively reversed, the height and duration of the rebound should be approached cautiously.

These data points indicate: The weekly bearish trend remains unchanged, and oversold rebounds are ongoing.

4. Market forecast: (03.02–03.08)

1. Building Bitcoin’s upward core (based on the post-February 6 low)

Bitcoin 4-hour chart:

Figure 5

Using the 4-hour chart as the trading cycle:

• Core construction: The current probability favors the formation of an “upward core” structure. The resistance is around $72,300, and support has shifted down to about $62,500.

• Main operational plan:

• Upside rebound: If the price breaks above $72,300, it may detach from the “core attraction” and continue a C-2 oversold rebound, though the space is expected to be limited.

• Downside adjustment: The support level has moved down to $62,500, close to the February 6 low of $60,000. If the price falls below this, the oversold rebound of C-2 may end, possibly entering a C-3 correction phase.

Regardless of which scenario unfolds, short-term trading should mainly follow the “sell high” principle.

2. This week’s core view: Maintain a range-bound oscillation, watch for the tug-of-war near the edges of the range. The strategy should be to “reduce positions on rallies and control risk.”

3. Key resistance levels:

• First resistance zone: $68,500–$70,000 (previously high-volume trading area)

• Second resistance zone: $72,300–$74,500 (near April 2024 lows)

4. Key support levels:

• First support: around $65,000 (important previous support zone)

• Second support: $60,000–$62,500 (near February 6 low)

• Third support: around $57,400 (near 210-week moving average)

5. A/B Strategy Plans (excluding unexpected news impacts): (03.02–03.08)

1. Medium-term: Maintain 60% short positions. If a rebound effectively breaks $74,500, reduce to 40%.

2. Short-term: Use 30% position with stop-loss, based on support and resistance levels, seeking spread trading opportunities (using 30-minute/60-minute cycles).

3. Given the overall medium-term bearish trend, short-term operations should follow the “trend-following, sell high” principle. To adapt dynamically to market changes and based on signals from our trading models, we propose two short-term plans:

   • Plan A: If the price rebounds to the resistance zone $70,000–$72,300:

   • Entry: Triggered by resistance signals and model top signals, establish a 15% short position.

   • Risk control: initial stop-loss at $75,500.

   • Exit: When the price drops near support and model signals confirm, gradually close positions for profit.

   • Plan B: If the price rebounds to $74,500:

   • Add to position: If the rebound continues and model signals confirm, increase 15% short position.

   • Risk control: stop-loss at $75,500.

   • Exit: When the price declines to support levels with model confirmation, close for profit.

6. Special reminders:​​

1. When opening a position: set an initial stop-loss immediately.

2. When profit reaches 1%: move stop-loss to break-even (entry price).

3. When profit reaches 2%: move stop-loss to 1% profit level.

4. Continuous tracking: for every additional 1% profit, move the stop-loss up by 1% to lock in gains.

Markets are volatile; all analysis and strategies should be adjusted dynamically. The views, models, and strategies discussed are based on personal technical analysis and are for personal reference only, not investment advice. Invest cautiously.