While Bitcoin continues to exhibit a strong long-term bullish outlook, technical indicators suggest a possible short-term downturn could be underway.
Market analyst Lark Davis has identified a bearish trading setup that may offer an opportunity for short sellers.
According to Davis, Bitcoin’s price action is currently confined within a descending channel. The cryptocurrency recently bounced off the upper resistance level of this channel — a move that historically signals weakening upward momentum.
Supporting this view is the Stochastic RSI, which has just flashed a bearish crossover, often interpreted as a signal of an impending decline in price.
Davis suggests that the current structure favors a short trade, with the ideal take-profit (TP) zone positioned near the bottom of the descending channel.
He emphasizes that despite this near-term bearish scenario, the broader trend for Bitcoin remains bullish, suggesting any correction could be temporary.
