Friday Morning Bitcoin and Ethereum Market Analysis and Trading Suggestions

Good morning, friends. Due to the Christmas holiday, the US stock market was closed yesterday, and overall market activity was relatively light. Bitcoin continued its previous upward trend, briefly testing above $88,500 before quickly pulling back. Currently, it has entered a sideways downward correction phase along with Ethereum.

From the four-hour chart, although Bitcoin broke through the midline with a large bullish candle, it was followed by consecutive bearish candles, indicating that the battle between bulls and bears is still ongoing. Despite some rebound and correction, the overall price remains within the triangle convergence zone. If there is no significant positive catalyst, the market is expected to continue a downward consolidation pattern.

On the hourly chart, after a large upward move, there is obvious overbought condition, which was mostly absorbed by subsequent bearish candles, bringing the price close to the midline support again. Although an effective breakdown has not yet occurred, the KDJ three-line trend and the MACD histogram shifting from bullish to bearish suggest that a downward breakout is only a matter of time. In the short term, maintain a bearish outlook, and consider short positions at higher levels after rebounds.

In terms of trading, focus on resistance around $88,000 for Bitcoin; after encountering resistance in this area, look toward around $86,000. For Ethereum, watch the resistance above $2,950, with a target around $2,850.