BTC/USD Forex Signal: Looking Bearish - 1 April 2020

Adam Lemon

BTC/USD: $6,293 about to break down

Yesterday’s signals were not triggered as there was insufficiently bullish price action at both of the support levels which were reached yesterday.

Today’s BTC/USD Signals

Risk 0.50% per trade.

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

Long Trade Ideas

  • Go long after a bullish price action reversal on the H1 time frame following the next touch of $6,396 or $6,293.

  •  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 $6,600.

  • 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 the resistance factors looked stronger than the support and I thought that we could see a bearish reversal from $6,600. I was right to look towards the short side, although the price never quite reached that level at $6,600, as we have seen the price drop.

The price is currently sitting right on the support level at $6,293 which looks extremely likely to break down and it has lots of room to fall further. Another bearish factor is that the price is moving down within a consolidating triangle from the upper edge of the triangle.

There is every reason to be bearish, but I would wait for a break below $6,293 evidenced by two consecutive hourly closes below that level on rising short-term volatility. Risk sentiment is souring, and the USD is strengthening, which should help bears.BTCUSDRegarding the USD, there will be a release of the ADP Non-Farm Employment Change data at 1:15pm London time, followed by ISM Manufacturing PMI numbers at 3pm.

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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