Yesterday’s signals were not triggered as there was no bearish price action when $4,374 was reached during the Asian session.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades may only be taken from 8am New York time Tuesday until 5pm Tokyo time Wednesday.
Long Trade
Long entry at a bullish price action reversal on the H1 time frame following the next touch of $4,374.
Put the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is $50 in profit by price.
Remove 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to run.
Short Trade
Short entry after a bearish price action reversal on the H1 time frame following the next touch of $4,982.
Put the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is $50 in profit by price.
Remove 50% of the position as profit when the trade is $50 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 the picture was now clearly more bullish, and the price had plenty of room to rise before hitting the next resistance level. I was generally bullish, but unsure about picking good entry points for long trades.
This was a good call and my note about the room to rise was timely, as Bitcoin continued to trade up before exploding upwards in a near 20% increase which at one point got above the big psychological round number at $5,000.
The picture is still relatively bullish but of course with such a strong increase in volatility, we are also likely to get deep pullbacks. The price is now right in the middle of a very wide zone between support and resistance, so it will probably need to stabilize before it will advance again firmly. Therefore, I take no bias today and it may be wise to stand aside until the price settles down.
Regarding the USD, there will be a release of Core Durable Goods Orders data at 12:30pm London time.