My previous BTC/USD signal on 25th January was not triggered as there was no bearish price action when the key resistance levels which I had identified were first reached.
Today’s BTC/USD Signals
- Risk 0.75% per trade.
- Trades may only be taken prior to 5pm Tokyo time Wednesday.
Long Trade Ideas
- Go long after a bullish price action reversal on the H1 timeframe following the next touch of $42,821 or $41,408.
- 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 Ideas
- Go short after a bearish price action reversal on the H1 timeframe following the next touch of $43,609, $44,508 or $44,648.
- 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.
- 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.
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 BTC/USD analysis on 25th January that the technical picture had become more bearish as the decline from the 20-month high reached two weeks ago continued, with the price trading below the big round number at $40,000.
The technical picture has become more bullish now as the price found support a bit below $40,000 and has been rising steadily ever since. However, it now seems as if bulls may have run out of momentum after the price failed to clear the resistance level at $43,609.
I am reluctant to take a short trade today and see the better potential trade set up, due to the long-term bullish trend, as a long trade following two consecutive higher hourly closes above $43,609 but only targeting the next resistance level at $44,508.
There is still quite a long way to go before the 20-month high above $48,000 is tested.
Regarding the US Dollar, there will be a release of US JOLTS Job Openings and CB Consumer Confidence data at 3pm London time.
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