Previous BTC/USD Signal
My previous Bitcoin signal on 23rd November was not triggered as none of the key support and resistance levels were reached that day.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be entered before 5pm Tokyo time Thursday.
Long Trade Idea
- Go long after a bullish price action reversal on the H1 timeframe following the next touch of $17,374.
- Put the stop loss $100 below the local swing low.
- Move the stop loss to break even once the trade is $100 in profit by price.
- Take off 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to ride.
Short Trade Idea
- Go short after a bearish price action reversal on the H1 timeframe following the next touch of $18,107.
- Put the stop loss $100 above the local swing high.
- Move the stop loss to break even once the trade is $100 in profit by price.
- Remove 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to ride.
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 in my previous analysis on 23rd November that the price of BTC/USD looked likely to
Continue falling to reach key support at about $14k before it had a good chance to bottom out and begin to rise meaningfully again.
I seem to have been wrong about that as the price has risen since then and not made any further long-term lows, with the low at $15,479 remaining intact.
The technical picture now is weakly bullish, with the price slowly moving up over the last 2 weeks. Risk-off sentiment was boosted yesterday by better-than-expected US inflation data, and this caused a selloff in the Dollar which benefited the price of Bitcoin in Dollars. It is worth noting that there are several other assets performing better than Bitcoin against the US Dollar, and crypto generally is suffering from the negative publicity over FTX and a widespread feeling that the crypto bubble has burst and will not be coming back for a while.
That said, there is a weakly bullish medium-term trend, although it is very slow.
Volatility remains historically low, but key support and resistance levels often continue to be respected by Bitcoin.
For these reasons, I see the best trading opportunities in Bitcoin as entering long trades when there is a bounce from a support level. The only key support level in sight is at $17,374 so that is the only level I am paying attention to for a trade entry now.
There are no resistance levels close beyond the first one at $18,107 so if the price can get established above that – which is very unlikely to happen today – it would be a bullish sign.
Concerning the US Dollar, there will be releases of the FOMC Statement, Federal Funds Rate, and Economic Projections at 7pm London time, followed half an hour later by the usual press conference.
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