From Dow Theory, Chan Theory, Wave Theory, Volume-Price Relationship, Order Flow, and Price Action Analysis of BTC Short-term Trends

$BTC ‌1. Dow Theory
Daily level: From the early April low of 66,888 to the high of 79,468 on April 22, Bitcoin is in a clear primary upward trend. The secondary correction from April 22 to April 29 (79,492 → 74,938) was completely broken through by a high-volume bullish candle on May 1, closing at 78,179, fully recovering the lost ground.
Current state: The May 2 daily candle continues to close higher (78,709), with lows and highs rising in sync (75,315 → 78,034 → 78,093 → 78,416 → 78,829). On the hourly level, the main upward trend per Dow Theory has fully resumed—lows keep rising (75,315 → 78,034 → 78,093 → 78,416), and highs are also rising (78,417 → 78,392 → 78,588 → 78,829). The current price of 78,709 is near the previous high of 78,829, testing the resistance at the previous high of 79,468. If broken through, it confirms the primary upward trend entering a new phase; if resisted and pulled back, a new consolidation platform may form in the 78,000–78,500 range.

2. Chan Theory
From the Chan perspective, the current phase is in an upward wave, and this wave is quite strong.
Pattern and strokes: The bottom pattern at 75,315 on April 30, 05:00 is the final point of the last decline, and the bottom pattern at 78,125 on May 1, 17:00 confirms the start of an upward wave. Subsequently, the top pattern at 78,417 on May 1, 22:00 was absorbed by the bottom pattern at 78,034 on May 2, 05:00 (a higher low), and the top pattern at 78,392 on May 2 was absorbed by the bottom pattern at 78,093 on May 2 (again a higher low). The top pattern at 78,588 on May 2 was absorbed by the bottom pattern at 78,416 on May 2, 20:00. This wave, extending upward from 78,416, has reached 78,829.
Central zone: After May 1, a new upward central zone formed between 78,034 and 78,417 (Central Zone 8), then the price broke upward. On May 2, a smaller central zone formed between 78,093 and 78,392 (Central Zones 9/10). The current price has moved out of this zone upward, indicating a departure segment. According to Chan logic, after leaving a zone, one must observe for divergence—i.e., the price hits a new high but MACD/strength does not—before confirming a top divergence. Currently, although 78,829 has made a new high, the momentum has not clearly weakened, so short-term upside remains possible.

3. Wave Theory
After the ABC correction, the new impulsive wave structure of 1-2-3 is clearly emerging:

Wave A: 77,899 → 74,938, a decline of about 2,961 points

Wave C end = new Wave 1 start: 74,938

Wave 1: 74,938 → 78,417, a rise of about 3,479 points, with internal 5-wave push

Wave 2: 78,417 → 78,034, a retracement of about 383 points (only 11.0% of Wave 1, very shallow retracement, indicating strong bulls)

Wave 3: 78,034 → 78,829 (current), up about 795 points
Current judgment: Wave 3 is in progress. According to wave theory, Wave 3 is usually 1.618–2.618 times Wave 1. Wave 1 length is 3,479 points, so Wave 3 targets:

1.618 times: 78,034 + 1.618 × 3,479 = 80,567

2.0 times: 78,034 + 2.0 × 3,479 = 82,992

2.618 times: 78,034 + 2.618 × 3,479 = 85,142
In the short term, Wave 3 has already broken above Wave 1 high of 78,417, confirming Wave 3 is unfolding. If Wave 3 reaches the 1.618 target of 80,567, the entire impulsive structure will be very complete.

4. Volume-Price Behavior
After the volume breakout on May 1, the volume-price coordination on May 2 shows healthy consolidation plus volume expansion at the close.
Total volume on May 2 was 17 billion (daily level), less than May 1’s 39.2 billion. In the morning (00:00–12:00), volume was subdued, with price oscillating narrowly between 78,000 and 78,400—typical of Wave 2 consolidation with decreasing volume—bulls reluctant to sell, bears unable to push down. After 13:00, volume gradually increased, especially between 21:00–22:00, with two massive bullish candles (745M + 618M), indicating Wave 3 initiation—active buying flooding in, breaking through the key resistance at 78,500.
The volume-weighted average price (VWAP) is at 77,138, while the current price of 78,709 is significantly above VWAP, indicating recent holders are generally in profit, and market sentiment is bullish. However, the 78,800–79,500 zone is a dense area of previous trapped positions; if volume cannot sustain expansion, resistance may appear here.

5. Order Flow
Order flow indicators improved steadily on May 2.
After Delta turned positive on May 1, in the morning of May 2, Delta fluctuated slightly but remained near zero, with no large negative values, indicating selling pressure has waned. After 13:00, Delta stayed positive, especially between 21:00–22:00, reaching intraday peak, with active buy orders absorbing sell orders—directly fueling Wave 3’s breakout above 78,500.
The cumulative Delta curve rose from -6 billion on May 1 to around -4 billion now, still negative but clearly trending upward. If Wave 3 continues, cumulative Delta is expected to turn positive, confirming buyers regain control. Currently, the order flow environment is slightly bullish, weaker than May 1’s buyer dominance but still supporting upward price movement.

6. Price Action
The recent 24 hours show classic Wave 2 consolidation with volume shrinking, followed by Wave 3 volume expansion breakout.
From 00:00–12:00 on May 2, price oscillated narrowly between 78,000 and 78,400, with small candles, many Doji and small yin-yang candles, and Bollinger Bands narrowing to 0.004 (extremely low), indicating a window for a trend reversal. After 13:00, price began a slow climb, with minor pullbacks to 78,416 between 18:00–20:00, not breaking below Wave 2 low of 78,034, forming higher lows.
At 21:00, a long bullish candle appeared, breaking above the Bollinger middle band, with volume expanding, a clear signal of Wave 3 starting. At 22:00, the candle continued higher, touching 78,829, RSI(14) rapidly rising from around 50 to 75, entering a strong zone but not overbought. Bollinger Band width expanded from 0.004 to 0.009, confirming volatility expansion and trend acceleration.

Short-term comprehensive judgment
Key levels:

Strong support: 78,034 (Wave 2 low + Chan central zone lower boundary), 78,416 (current higher low)

First resistance: 78,829 (current high), 79,468 (previous high)

Second resistance: 80,000 (psychological level), 80,567 (Wave 3 1.618 target)

Strong resistance: 82,992 (Wave 3 2.0 target)

Scenario projections:
Bullish bias (higher probability): Wave 3 continues, price volume-breaks above 79,468 previous high, targeting 80,000–80,567. This signals a complete 1-2-3 wave structure, with subsequent Wave 4 correction and Wave 5 surge.
Neutral scenario: Price oscillates in 78,500–79,500 range, forming a new central zone, awaiting direction. This could last 12–24 hours, with limited retracement depth (not below 78,000).
Bearish scenario (lower probability): Price falls below 78,034 with volume expansion, invalidating Wave 3, reverting to Wave 2 or even Wave 1 zone. Strict stop-loss below 77,800 needed.
Current judgment: The ABC correction has ended, and the new impulsive Wave 1-2-3 is very clearly unfolding. The May 2 consolidation in Wave 2 with volume shrinking plus the volume breakout in Wave 3, combined with the Chan central zone departure, rising Wave 3, Dow lows rising, and positive Delta signals, form a fourfold resonance. The short-term trend is in Wave 3’s main upward phase, targeting 80,000–80,567. Holders can keep positions, with stop-loss moved up to 78,000; non-holders should wait for a pullback to 78,400–78,600 for entry, avoiding chasing highs.