BTC/USD Forex Signal: Less Bearish

Adam Lemon

The bearish movement is weak, and we see the technical picture now becoming somewhat more bullish 

BTC/USD: Bulls holding support at $9,014

Yesterday’s signals produced a short trade from the bearish reversal at the resistance level at $9,233 which is currently in floating profit. However, as the technical picture has become less bearish, it may be wise to exit this short trade for a small profit as soon as possible.

Today’s BTC/USD Signals

Risk 0.50% per trade.

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

Long Trade Idea

  • Go long after a bullish price action reversal on the H1 time frame following the next touch of $8,136.

  • 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 Ideas

  • Go short after a bearish price action reversal on the H1 time frame following the next touch of $9,233, $9,400, or $9,462.

  • 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 I took a bearish outlook on Bitcoin as risk sentiment in the markets deteriorated, and I thought that we could see a stronger fall all the way down to the next supportive area near $8,100. I was happy to take another short trade from a bearish reversal which may happen at any of the resistance levels identified above the current price.

This was a good call as the price did make a bearish turn at the nearest resistance level, providing an opportunity to enter a short trade which has generated some floating profit. However, the bearish movement is weak, and we see the technical picture now becoming somewhat more bullish as the support near the round number at $9,000 continues to hold – so we seem to be getting buyers down there.

I see the best potential opportunity today as a long trade from a bullish bounce at $9,014 which would ideally reject the confluent round number just below at $9,000 with the same movement. The time looks ripe for a bullish surprise as risk sentiment is broadly improving in the markets, so I will take a bullish bias if we get this bounce at $9,014 later.BTCUSDConcerning the USD, the Chair of the Federal Reserve will be testifying before the House of Representatives at 5:30pm 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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