BTC/USD Forex Signal - 6 February 2018

Tuesday, 6 February 2018 10:35

Yesterday’s signals were not triggered, as there was no bullish price action at any of the support levels which were reached.

Today’s BTC/USD Signals

Risk 1.00% per trade.

Trades can be entered at any time.

Long Trades

  • Long entry after a bullish price action reversal on the H1 time frame following the next touch of $5,638, $5,410, or $4,912.

  • Put the stop loss 1 pip below the local swing low.

  • Adjust the stop loss to break even once the trade is $200 in profit by price.

  • Take off 50% of the position as profit when the trade is $200 in profit by price and leave the remainder of the position to ride.

Short Trades

  • Go short after a bearish price action reversal on the H1 time frame following the next touch of $7,347.

  • Put the stop loss 1 pip above the local swing high.

  • Adjust the stop loss to break even once the trade is $200 in profit by price.

  • Take off 50% of the position as profit when the trade is $200 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

My bearish bias was proven to be correct again, although there has been a sharp recovery today after the London open. The situation looks even worse for Bitcoin, which has just fallen to a low price approximately 70% from its high price reached a few weeks ago. Bitcoin has not seen such a drop for several years, and other cryptocurrencies have also experienced severe price drops. The bubble has burst, and although assets can recover from such bubbles, the recovery usually takes some time to come.

Technically, the picture is dominated by bearish trend lines. There are minor signs that the price may be bottoming out just above $5,000 which is an important psychological level for Bitcoin. I maintain a bearish bias and prefer a potential short trade from $7,347. If the price can get established above $7,500 that would be a great surprise and a bullish sign.

BTCUSD

There is nothing due today concerning the USD.

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment. Learn more from Adam in his free lessons at FX Academy.

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