BTC/USD Forex Signal: Consolidation Continues

Adam Lemon

The short-term price action is bearish, but the thing to watch for here really is a bullish bounce at the support near $9,000 which could be a good long-term trade entry if the price finally breaks bullishly above the psychological resistance at about $10,000 which has been a cap for a long time.

BTC/USD: Awaiting breakout from $9,304 - $9,015 range

Yesterday’s signals were not triggered as there was no bearish price action when the resistance level identified at $9,233 was first reached.

Today’s BTC/USD Signals

Risk 0.50% per trade.

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

Long Trade Ideas

  • Go long after a bullish price action reversal on the H1 time frame following the next touch of $9,014.
  • 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 $9,223, $9,304, $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 thought that a bullish breakout was more likely than a bearish breakdown from a narrow range between $9,014 and $9,233, so I would be happy to take a long trade from a firm bullish bounce at $9,014.

I was correct to see the bullish move, but despite the general improvement in risk sentiment which we saw in markets, Bitcoin only rose by a little before felling back into the zone of the former narrow range. There is little change to the technical picture, beyond readjusting the nearby resistance levels slightly.

The short-term price action is bearish, but the thing to watch for here really is a bullish bounce at the support near $9,000 which could be a good long-term trade entry if the price finally breaks bullishly above the psychological resistance at about $10,000 which has been a cap for a long time.

BTC/USD

Concerning the USD, there will be a release of U.S. Non-Farm Payrolls data at 1:30 pm 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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