Yesterday’s signals were not triggered, as the bullish price action took place slightly below the support level identified at $6,263.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades must be entered before 5pm Tokyo time today, over the next 24-hour period only.
Long Trade
Go long after a bullish price action reversal on the H1 time frame following the next touch of $6,171.
Place 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 $6,289 or $6,353.
Place 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
I wrote yesterday, as I have been writing for more than a week, that when the price finally moved out of its narrow range of consolidation, the move would be likely to be explosive. We finally got the move yesterday, with the price moving down sharply, although by Bitcoin standards the movement was not huge. However, relatively to prevailing volatility, it was explosive. I had thought a bullish movement more likely, but when it came it was bearish.
The technical picture here is now considerably more bearish, with the price selling from new lower resistance which has formed at $6,289 and there is a case for seeing the long-term bearish trend reassert itself. However, there is also a case for seeing the $5000 to $6000 price area as a fair price for Bitcoin, so it may not fall much further.
I see reversals in either direction at any key levels nearby as potentially good trade setups. I think the price is most likely to move downwards today, but I would not be bearish without a rejection of a resistance level taking place first.
Regarding the USD, there will be a release of CB Consumer Confidence data at 3pm London time.