Bitcoin: Range is holding
Yesterday’s signals were not triggered, as none of the key levels were reached over the past day.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades may only be taken before 5pm Tokyo time Thursday.
Long Trade Ideas
Long entry after a bullish price action reversal on the H1 time frame following the next touch of $7,131 or $6,786.
Put 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
Short entry after a bearish price action reversal on the H1 time frame following the next touch of $7,445, $7,698 or $7,824.
Put 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 there were a lot of support and resistance levels nearby, so price movement was likely to be difficult to predict. I thought that it would probably be wise to stand aside from trading Bitcoin for the time being. It could make sense to be bearish below $7,131 or bullish above $7,824.
I could have been more bearish, but I was right to not look for a bullish reversal until $7,131. The range I mentioned from $7,131 to $7,824 continues to hold and shows every sign of staying that way.
Therefore, I think the best opportunity which might arise today would be a long trade from a bullish bounce at $7,131. I would take a bullish bias if that sets up today, but bulls should be cautious here.
Regarding the USD, there will be a release of CPI (inflation) data at 1:30pm London time and the FOMC Economic Projections, FOMC Statement, and Federal Funds Rate at 7pm plus the usual press conference half an hour later.