BTC/USD Forex Signal: Strong bullish consolidation - 30 January 2020

Adam Lemon

BTC/USD: Key support near $9,200 holding

Yesterday’s signals produced a long trade from the bullish bounce at the support level identified at $9,233 which is currently in floating profit.

Today’s BTC/USD Signals

Risk 0.75% per trade.

Trades may only be entered before 5pm Tokyo time Friday.

Long Trade Ideas

  • Go long after a bullish price action reversal on the H1 time frame following the next touch of $9,190 or $8,802.
  • Place 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 Idea

  • Go short after a bearish price action reversal on the H1 time frame following the next touch of $9,489.
  • Place 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 had become more bullish technically with the breakout, and beyond the next resistance level at $9,489 the price had even more room to rise with no resistance, although the big round number and psychological level at $10,000 would probably have an effect if it is reached.

This was a good call as the price has held up. Technically, I have just had to adjust the nearby support level downwards slightly.

The price is now showing a bullish consolidation pattern. Due to the strength of the recent bullish move, this is a bullish sign, but it would make sense to only take a long bias and enter a long trade following a bullish bounce at $9,190 or following two consecutive hourly closes above the resistance level at $9,489 later.

It is notably bullish to see Bitcoin advancing or holding firm in the current risk-off market environment.

BTC/USD

Concerning the USD, there will be a release of Advance GDP data at 1:30pm London time.

Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy

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