BTC/USD Forex Signal: Bullish Triangle?

Adam Lemon

The technical picture is looking more bullish now, with a short-term consolidating triangle forming which looks likely to see upside breakout. 

BTC/USD: Room remains for lots of upside

Yesterday’s signals were not triggered, as there was no bearish price action when the resistance level identified at $10.985 was first reached.

Today’s BTC/USD Signals

Risk 0.50% per trade.

Trades must be taken before 5 pm Tokyo time Thursday.

Long Trade Ideas

  • Go long after a bullish price action reversal on the H1 time frame following the next touch of $10,696, $10,456, $10,123 or $10,039.
  • 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 at the next touch of $13,218.
  • 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 we would not see higher prices beyond the previous day’s peak for at least a few days, suggesting that the best opportunity was likely to be on the short side.

Therefore, I was prepared to take a short trade today from a bearish reversal at $10,985.

This call was enough to keep out of trouble as we did not get any bearish price action at $10,985 and this former resistance level has been clearly invalidated.

I have also been correct, at least so far, that we would not see new highs any time soon, with the peak made earlier in the week still holding.

However, I do think the technical picture is looking more bullish now, with a short-term consolidating triangle forming which looks likely to see upside breakout. So, I think new highs are quite likely to happen soon. Despite that, I do not like the idea of taking a long trade from a bounce at support as that would require a bearish breakdown of the triangle.

This means overall that I do not see a good opportunity here, although the FOMC release later could trigger a strong move. The only possibility might be a short trade from $13,218 in the very unlikely event that the price gets up there later after the release.

BTC/USD

Regarding the USD, there will be a release of Pending Homes Sales data at 3pm London time, followed by the FOMC Statement and Federal Funds Rate at 7pm then the usual press conference half an hour later.

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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