The Bitcoin market has shown signs of an increase in sales pressure, and recent price actions suggest a deeper distribution stage under the surface.
The Wyckoff pattern reveals an imminent failure
In a post on social media platform X on August 2, Crypto analyst Joao Wedson explained how Bitcoin prices risk recession over the coming months. Analysts build on their conclusions based on the Wyckoff Distribution model, a technical analytics framework that explains how smart money sells assets at the top of the market cycle.
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Wedson highlighted in the article that the 13-stage schematics are unfolded in real time. This shows that even if retailers maintain their hopes, institutional investors (known as “smart money”) are preparing to leave the market.
Analysts began breaking down at a reserve supply (PSY) phase where there were subtle signs of facility sales and a purchase climax where prices peaked due to exhausting demand. This phase is then followed by an automatic response (AR), which defines the bottom of the distribution range with a sharp drop in the price of Bitcoin.
The fourth and fifth phases are quadratic tests (ST), where the price retests highs in the distribution range, but weak momentum and volume. Once the pattern matures, the price enters phase B with lateral movements, causing disruption to retail participants as the facility quietly offloads the coin.
The most unanswered signs are shown in phases C and D. Here we first show signs of weakness (SOW). This is a major signal of decline in demand. Then there is the final point of supply (LPSY). This usually creates a suitable set up for shorts.
Finally, still within phases C and D, ice breaks lead to deeper drops, followed by a second LPSY trap, sealing the distribution.
Is Altcoin Rally ongoing?
Going further, Wesson noted that market makers were spinning into altcoins. According to analysts, Altcoins have already ended its accumulation zone and are positioned for structural markup, reflecting growing interest in the Altcoin market.
By contrast, Bitcoin has entered the weekly distribution phase. This can be reflected in the short term as weak or modest performance. Wedson added that by the end of 2025, there will be a full spin from BTC to Altcoins, and finally added to Fiat.
At the time of writing, Bitcoin is rated at around $113,439, not reflecting any significant movements over the past 24 hours.
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