When trading short-term, the set of indicators I often use can provide quite clear long and short signals on the 10-minute to 1-hour timeframe. Interestingly, when zooming out to larger timeframes like the 3-day and weekly charts, they can also be quite helpful.

Looking at BTC's 3-day K-line, we can see that a divergence has appeared at this level—price is still falling, but the indicator has already started to turn back. The first red dot appears when the downward momentum is strongest, then the price begins to oscillate repeatedly, and the indicator gradually returns to the middle axis, forming a divergence. What does this indicate? It suggests that selling pressure is gradually weakening.

Such situations were also seen earlier in the year (February-April 2025). At that time, the K-line and trendline diverged the most at the first red dot. Later, the K-line oscillated downward, but the indicator gradually converged, even signaling oversold conditions. What happened next? A nice rebound.

Looking back further, during the black swan event on May 19, 2021, the first red dot coincided exactly with that point. The whole process was like this: price sharply diverged from the trendline → indicator gradually recovered → divergence formed → price started to approach the trendline → then a strong rebound occurred.

But it’s not always so smooth. After divergence and oversold conditions appeared in July 2022, although the price approached the trendline, it was still held down and failed to break through the $23,000 level. It wasn’t until the FTX collapse, a black swan event, caused a second divergence and slight oversold conditions (BTC dropped to $15,800), that the market truly broke through the trendline in January 2023, kicking off a new bull run.

So, the possible scenarios moving forward are:

First, divergence correction completes, and after a short-term pullback, the price initiates a rebound, retesting key resistance levels;

Second, a second divergence occurs, which may require a stronger impulse to truly reverse the trend.

The key is to patiently wait for these signals to be confirmed.