Bitcoin bullish: The trade setup

After collapsing over 50%, Bitcoin has stabilized in recent weeks. The largest crypto by market cap is currently trading in a tight range between $66,000 and $70,000. While most investors and traders are extremely bearish right now, the charts—combined with market sentiment—have me near-term bullish.

First, the biggest open interest on puts is sitting at the $40,000 strike. This signals that far too many investors are betting on easy downside, making it a massive contrarian bullish indicator. In addition, when I called the top back in October 2025, I was told I was "insane" and would get crushed shorting it. Now, sentiment has done a complete 180. People are telling me Bitcoin is going to $0 and that going long will annihilate my crypto portfolio. That kind of extreme sentiment shift gets me excited.

Next, looking at the charts, we recently saw a bullish reversal on Bitcoin. While the macro (larger time frame) picture is still bearish, the micro (near-term time frame) is decidedly bullish. We are currently looking at a classic "in-spirit-of" bull flag formation.

The Trade Setup: This bullish pattern remains intact as long as the $60,000 level holds. If that support breaks, the bullish thesis fails. That is your stop-out level, limiting your risk to approximately a 10% loss. Keep in mind that the pattern does weaken slightly if price drops below $66,000.

The play here gives you two options:

• The Aggressive Play: Go long around $66,500 for an upside target of $80,000–$85,000, representing a potential gain of 23–30%.
• The Lower-Risk Play: Wait for a confirmed breakout above $70,000 for a lower-risk entry, targeting a 15–22% gain.