BTC/USD Forex Signal: Pressure building for further upside breakout

Adam Lemon

Bitcoin: Still Bullish

Yesterday’s signals were not triggered as none of the key levels were quite reached.

Today’s BTC/USD Signals

Risk 0.50% per trade.

Trades must be taken prior to 5pm Tokyo time Friday.

Long Trade Ideas

  • Long entry after a bullish price action reversal on the H1 time frame following the next touch of $7,228 or $7,047.
  • Place the stop loss $50 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 Ideas

  • Short entry after a bearish price action reversal on the H1 time frame following the next touch of $7,670 or $8,004.
  • Place the stop loss $50 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 there was no real change to the basically bullish technical picture. I remained weakly bullish as long as the price held up above $7,000 but I wanted to see the price close a couple of consecutive hours above $7,500 before becoming more strongly bullish.

This was a fairly good call as the price has continued to advance slowly while holding up above $7,000 but has not yet broken $7,500 to rise more convincingly and become more clearly bullish.

It makes sense to continue with yesterday’s approach: weakly bullish above $7,000 and more strongly bullish above $7,500. Improved risk sentiment is holding up and causing stock markets, especially in the USA, to continue their advance, and as long as that continues Bitcoin is likely to continue to rise. However, when looking at the U.S. stock market indices, it is worth noting that both major stock indices have retraced almost 50% of the value of their coronavirus crash from February to March, and that would be a likely technical point at which we might expect a bearish trend to resume. Either way, we are close to a pivotal point in U.S. stocks and if stocks start to fall sharply again, that will probably hit Bitcoin also.

BTC/USD

Regarding the USD, there will be a release of Unemployment Claims at 1:30pm London time.

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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