Bitcoin: Ranging between $8,893 and $8,546
Yesterday’s signals were not triggered as there was insufficiently bearish price action at $8,893 – however, this level did contain the high of the day almost to the pip so was very accurate as resistance.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades may only be entered prior to 5pm Tokyo time Friday.
Long Trade Ideas
Long entry after a bullish price action reversal on the H1 time frame following the next touch of $8,546, $8,375, or $8,216.
Place the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is $50 in profit by price.
Remove 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to run.
Short Trade Ideas
Short entry after a bearish price action reversal on the H1 time frame following the next touch of $8,893, $9,904, or $9,233.
Place the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is $50 in profit by price.
Remove 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to run.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
BTC/USD Analysis
I wrote yesterday that the technical picture was still bullish, with higher support formed at $8,546 and the price has continued to advance. However, bulls needed to be aware that we also had new lower resistance which was likely to be a pivotal level now.
This was a pretty good call as support continues to hold so the picture remains bullish, but the nearby resistance is holding as well, giving a ranging pattern between $8,893 and $8,546.
As the major movement is still upwards, I think it is wise to keep a bullish bias as long as the support at $8,546 continues to hold. So, I would be very happy to take a long trade if we get a bullish bounce at $8,546 today.
As Bitcoin is at relative lows and is being bought as 2020 begins, I think there is a good chance we are seeing the start of a long-term price rise.
Concerning the USD, there will be a release of Retail Sales data at 1:30pm London time.