BTC/USD Forex Signal: Rising Wedge Pattern

Adam Lemon

Action in Bitcoin is going to be relatively quiet until we get the long-awaited breakout beyond $10,000.

BTC/USD: Signs of support at $9,233

Yesterday’s signals were not triggered as there was no bearish price action when the price first reached the resistance level identified at $9,304.

Today’s BTC/USD Signals

Risk 0.50% per trade.

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

Long Trade Ideas

  • Go long after a bullish price action reversal on the H1 time frame following the next touch of $9,233, $9,109 or $9,011.
  • 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 $9,400 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 the technical picture has been slowly becoming more bullish every day as $9,000 continued to hold. I thought that the thing to watch for was whether the price would continue to rise and break out above the nearby resistance levels leading up to the psychologically very important area at $10,000.

I took a bullish bias here as we got two consecutive hourly closes above $9,304.

This was an OK call although the price is a little lower than yesterday’s entry-level, bulls should not be worried at all as long as the support level at $9,233 continues to hold. However, action in Bitcoin is going to be relatively quiet until we get the long-awaited breakout beyond $10,000.

Meanwhile, I am happy to take a cautiously bearish bias as long as the price stays above $9,233.

A break above $9,400 would be a significantly bullish development and that could be used as an alternative signal to take a new long trade.

BTC/USD

There is nothing of high importance scheduled today regarding the USD.

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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