Cryptocurrency: Bitcoin
- Lester Davids
- 2 days ago
- 7 min read
Research Notes January 2026 > https://www.unum.capital/post/rjan2026
Trade Local & Global Financial Markets with Unum Capital.
To get started, email tradingdesk@unum.co.za
Instrument: Bitcoin (BTCUSD)
Sector: CRYPTOCURRENCY / DIGITAL ASSETS
Closing Price: $92,466
1D Change: +1.05%
Multi-Frame Action: 🟢 Rebound (D) 🟡 Stabilization (W) 🟢 Bullish (M)
Technical Upside: Resistance at $98,000. Target: $100,000 (~8%). Psychological Reclaim.
Momentum Signal: Extreme Impulse (Short Term Overheated)
Risk / Invalidation: Close below $84,000
Valuation: Risk-On / Monetary Network
Primary Driver: Global liquidity cycles & Spot ETF inflows.
MARKET STRUCTURE & VOLUME VALIDATION
Volume Profile: Volume remains relatively muted (833.99) compared to the capitulation spikes seen during the drop to $84,000. This suggests a "supply shock" recovery where prices are drifting higher due to a lack of sellers rather than aggressive new volume—caution is warranted until volume expands.
Liquidity Zones: A significant base has formed at the $84,000 – $86,000 level, creating a structural floor. The price is currently grinding upward through a low-liquidity vacuum. The primary overhead target is the psychological $100,000 level, which coincides with previous structural support turned resistance.
Divergences: A potential "Hidden Bullish Divergence" is playing out. The momentum indicators have snapped back aggressively while price is still recovering, indicating internal strength is building faster than price action reflects.
RELATIVE STRENGTH (SECTOR & INDEX) vs. Altcoins: Dominant. Bitcoin continues to lead the recovery, likely sucking liquidity from smaller caps as confidence returns to the sector.
vs. Nasdaq 100: Correlated. The recovery aligns with broader risk-on sentiment in tech equities, suggesting macro tailwinds are assisting the move.
SCENARIO ANALYSIS (RISK MANAGEMENT) Bull Case (Primary): The momentum indicators are screaming "Impulse." If buyers can push through the $95,000 local resistance, a squeeze toward $100,000 is highly probable. A daily close above $93,500 validates the current impulse.
Bear Case (Alternative): The momentum is extremely heated (Yellow/Red lines > 90). If price stalls here without expanding volume, a "mean reversion" pullback to retest $88,000 is likely. A close below $84,000 invalidates the entire recovery structure.
MOMENTUM PROFILE: BITCOIN (BTCUSD)
Daily Chart (Standard) Outlook: Violent Reversal / Impulse Ultra Short Term: Extreme — The yellow line (2-period) is pinned at 98.17, a near-maximum reading. This indicates panic buying or a violent short squeeze is effectively in play right now. Short Term: Extreme — The red line (3-period) is at 93.69, confirming the intensity of the short-term move. Mid Term: Strong — The green line (78.32) has surged into the upper tier, pulling the medium-term trend out of neutral. Base Term: Bullish — The blue baseline (61.85) has successfully crossed the midline, signaling that the broader trend has shifted back to positive despite the recent correction.
Lester Davids
Senior Investment Analyst: Unum Capital
Trading Notes/Resources (Where Applicable)
READY TO TRADE: ACTIONABLE AREAS: For active traders who look to generate cash flow on a continuous basis, determining the ‘next best probability’ level to execute against may be of immense value. The blue and red horizontal lines on the chart represent a next best probability buy re-entry range and a next best probability sell re-entry range over the short term. The ranges assume no existing position being held by a trader while the probabilities are based on several factors which may include: short term rating, medium term regime, momentum, horizontal or diagonal support/resistance, candle structure, moving averages and standard deviation, among others. These are short term levels and may be in contrast to medium and long term outlooks which are based on the weekly and monthly charts and, which may be applicable to long term investors. These levels are subject to change based on sentiment, the subsequent price action and company/sector specific or macro news flow. As always, while the levels are outlined, traders should be prepared to adjust in real-time based on the aforementioned.
"Strategy Alerts" help clients identify trading opportunities. When a ticker's real-time or pre-market price action aligns with the criteria on a slide—such as a pullback to the 21-day EMA or a breakout from a consolidation base—it effectively "matches" that stock to the strategy, triggering an alert to a potential trading opportunity. This approach transforms the playbook into a dynamic scanning tool, allowing you to instantly categorize active stocks by the specific technical thesis playing out, ensuring that every trading potential opportunity communicated is backed by a predefined, actionable setup.
THE TACTICAL TRADING GUIDE (PRICE ACTION MODEL): UNCOVER OPPORTUNITIES & ASSESS REWARD-TO-RISK
It helps helps clients determine and shed light on the some of the following:
The CURRENT TECHNICAL POSITION and a PRICE ACTION PROBABILITY for multiple time frames.
Three (3) ‘trading’ time frames are considered: Short Term (1 to 10 days) / Medium Term (2 to 4 weeks) and Long Term (5 to 8 weeks)
Whether the reward-to-risk is attractive for a buy/long position
Whether a share is weak. In this case, wait until the price stabilizes before looking to enter (i.e. want until it stops going down)
Whether aggressive buying is underway. In this case, do not ‘chase’ (do not buy) but instead wait for a pullback to re-enter a buy or an overextension with deteriorating candle structure to sell/short.
Whether a trader can look to buy a pullback into a key moving average (continuation trade)
Whether a share needs to break a range for a new trend to be determined (bullish or bearish)
Whether a traders needs to monitor for a change of character that could lead to a bullish or bearish reversal
Whether a share could start a consolidation phase or before continuing it’s bullish or bearish trend
Whether the upward momentum is slowing (if it's in a bullish phase)
Whether buyers can look to 'phase in' to a position (if it's in a bearish phase)
Whether a share lacks directional bias.
The data set is available in real-time (on request)
The readings are subject to change as the price action develops.
TRADING TIP # 1 Let The Candle Confirm
Out of all those available, Candlestick Charts are the most widely used when it comes to analyzing price from a technical perspective. The interpretation thereof helps traders to understand the interaction between market participants and informs who is in control between buyers and sellers. Various types of candle formation convey key information about the range of outcomes for a share for example, following a downward trend, a long lower tail, doji, piercing or bullish engulfing suggests that buyers have started to become active/started to take an interest while following an upward trend, a long upper tail, doji, dark cloud cover or bearish engulfing suggests that sellers have started to become active/started to take an interest. While information is conveyed pre-market, it is the intraday price action that will confirm any trade or opportunity. While we have a plan, we are also ready to switch gears as the price action develops.
TRADING TIP # 2: Failure & Reclaim
FAILURE to hold a prior session high/range high may signal that the upside momentum is slowing and that an opportunity to short/sell may be at hand. This is often reflected via a deteriorating candle structure which suggests that sellers are starting to take control. Examples of such candles are long upper tails, doji's, dark cloud covers, bearish engulfing candles etc. RECLAIMING a prior session low/range may signal that the downside momentum is slowing and that an opportunity to buy may be at hand. This is often reflected via a improving candle structure which suggests that buyers have started to enter and are looking to take control of the price action. Examples of such candles are long lower tails, doji's, piercing candles, bullish engulfing candles etc.
TRADING TIP # 3: Take Note of the 'Igniting Bar'
This is a large green or red candle which suggests that traders should: TAKE NOTE note of the change in characters and potential change of the trend. TAKE NOTE of a potential acceleration of the trend. TAKE NOTE of potentially aggressive buy or selling Often, BIG MOVES start with BIG MOVES.
Core Trading Principles: Short and Medium Term
Trade with the primary trend.
Volume Matters. This represents the interest of large institutional investors who have the ability to move a share, both up and down.
Do not short/sell a share that is above, and in close proximity to it’s rising 8 and 21-day moving averages. This trend can persist for an extended period.
Ultra short term traders, if a share has advanced strongly over a 3-7 day period, book profits. You can always re-enter and do the same trade at lower levels.
If a share is printing a large bullish (green) candlestick following an extended move, use the strength to sell. The likelihood that the share retraces is high.
If a share is printing a large bearish (red) candlestick following an extended move to the downside, use the weakness to start a long position. The likelihood that the share rebounds is high.
Trade in the direction of the 20-day moving average, using the MA as a level to enter as well as a hard break thereof as a trailing stop-loss.
The 8 and 21-day moving averages often act as support and resistance levels. When they are turning down, use them as levels to sell into. The opposite applies when they are turning up.
The first back-test and undercut of the 50/75-day exponential moving average range has a high probability of holding as support or resistance. Buy or sell it for a 1-3 day move to generate cash flow.
Stocks above a rising 200-day moving average spend the majority of their time trending higher. The opposite applies when the 200-day is trending down.
Previous support can turn into resistance and previous resistance can turn to support. Use these zones as levels to trade against.
Support and resistance levels and key moving averages are ranges rather than exact levels. They often overshoot these zones before occasionally reversing at these levels.
Respect the FIB (Fibonacco) retracement zones. They often act as support and resistance levels.
‘PAY-tience Pays’, however be nimble to react to opportunity to cut when a trade hasn’t been working.
Above all, know your time horizon.
Lester Davids
Senior Investment Analyst: Unum Capital
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