BTC/USD Forex Signal: Bearish Trend - 26 February 2020

Adam Lemon

BTC/USD: Support at $9,518 finally breaks down

Yesterday’s signals were not triggered as unfortunately the price was just $3 short of hitting the resistance level identified at $9.844.

Today’s BTC/USD Signals

Risk 0.50% per trade.

Trades may only be entered 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 $8,802 or $8,683.

  • Put the stop loss $50 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 Idea

  • Short entry after a bearish price action reversal on the H1 time frame following the next touch of $9,460.

  • Put the stop loss $50 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 despite the dominant descending trend line confluent with $10k which was likely to be strong resistance, we had very firm buying just above $9,500. Therefore, I put my hope in a long trade from $9,518 to rise to $9,844 at least. I was wrong and should have paid more attention to the fact that Bitcoin tends to do badly in risk-off market environments such as we have very clearly at the moment with stock markets falling strongly.

The break below the $9,500 area of former support plus the fact that key resistance areas continue to hold are bearish signs, in addition to the medium-term descending trend line which dominates the price chart technically, so I am comfortable taking a short trade bias from a bearish reversal at any resistance level reached today, or even $9,250.BTCUSDThere is nothing of high importance due today regarding the USD.

About the Author
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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