Bitcoin: Bulls fail at $10,921
Yesterday’s signals were not triggered precisely, but I did forecast a bearish bias following a failure near $11,000 and this would have provided some profit on the short side. If such a trade was taken, it may be wise to close at least part of the position now as the price has reached close to the support level at $10,642.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades must be taken prior to 5pm Tokyo time Wednesday.
Long Trade Ideas
- Go long at a bullish price action reversal on the H1 time frame following the next touch of $10,642, $10,270, or $9,991.
- Place the stop loss 1 pip below the local swing low.
- Adjust the stop loss to break even once the trade is $50 in profit by price.
- Take off 50% of the position as profit when the trade is $50 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 time frame following the next touch of $10,921 or $11,112.
- Place the stop loss 1 pip above the local swing high.
- Adjust the stop loss to break even once the trade is $50 in profit by price.
- Take off 50% of the position as profit when the trade is $50 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 that the picture was less bearish as the price had been slowly struggling upwards over the past few days. However, bulls were going to face a very big test just below $11,000 as we had a confluence of a resistance level and two long-term bearish trend lines which I thought was probably going to be hard to break.
This was a great call as the price did fail to rise higher just below $11,000 and turn bearish, as I had predicted.
The picture now is more bearish, and we may well be seeing the start of a major move down. However, bears need to watch out for the support at $10,642 and possibly at $10,500 as well, although that latter level is not marked on the price chart below.
If the price can get established later above $11,112 this would be a significant bullish breakout.
There is nothing of high importance due today concerning the USD.