Bitcoin: Buyers and sellers very evenly matched
Yesterday’s signals produced a long trade entry from the bullish bounce off the support level identified at $9,974, but it would probably be wise to exit this trade immediately as the price looks very evenly balanced and trendless.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades must be entered prior to 5pm Tokyo time Friday.
Long Trade Ideas
Go long at a bullish price action reversal on the H1 time frame following the next touch of $9,974 or $9,801.
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 $10,168 or $10,476.
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 weak bullish short-term trend was persisting, but I did not see the price as likely to get established below $9,800. For this reason, I wanted to avoid trading this pair as I did not think the day’s price movement would be easy to exploit profitably.
This was a good call as although the support level at $9,974 held, the price has moved little, and seems to be caught very evenly between buyers and sellers. For this reason, it is extremely difficult to forecast the next major directional price movement.
I can say that the support at $9,801 is quite likely to hold and might produce a major bullish movement, so I would only look to take a bearish bias below that level, or a bullish bias if we get a strong bounce there later at a test of that level. Either way, it is likely to be an important pivotal point.
Regarding the USD, there will be a release of CPI (inflation) data at 1:30pm London time.