BTC/USD Forex Signal - 16 May 2018

Yesterday’s signals were not triggered, as there was no bullish price action at $8,334.

Today’s BTC/USD Signals

Risk 0.75% per trade.

Trades can be entered until 5pm Tokyo time today, over the next 24-hour period.

Long Trade

  • Go long after a bullish price action reversal on the H1 time frame following the next touch of $7,825.

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

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

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

Short Trades

  • Go short after a bullish price action reversal on the H1 time frame following the next touch of $8,334 or $8,593.

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

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

  • Remove 50% of the position as profit when the trade is $200 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 although the situation looked a little bullish, it was better to stand aside. This at least prevented losses as the action turned much more bearish, with the long-term bearish trend line holding. The bears seem to be in full control now, with no key support levels close by, and new lower resistance levels above. For this reason, I have a bearish bias today. It is interesting to see how Bitcoin is behaving more and more like a Forex currency pair, and the exploding of the wild claims made in favour of Bitcoin a few months ago should be an important lesson. Bitcoin is not going to $100,000 any time soon!BTCUSD

Regarding the USD, there will be a release of Building Permits data at 1:30pm London time followed by Crude Oil Inventories data at 3:30pm.

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.