BTC/USD: Resistance above $12k likely to be very strong
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be entered prior to 5 pm Tokyo time Tuesday.
Long Trade Ideas
- Long entry after a bullish price action reversal on the H1 time frame following the next touch of $11,659 or $11,400.
- Place the stop loss $50 below the local swing low.
- Move the stop loss to break even once the trade is $50 in profit by price.
- Remove 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to run.
Short Trade Ideas
- Short entry at the next touch of $13,218.
- Place the stop loss $50 above the local swing high.
- Move the stop loss to break even once the trade is $50 in profit by price.
- Remove 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to run.
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
There is no doubt that Bitcoin is enjoying a strong long-term bullish trend, as it has recently made new 1-year high prices.
It is true that the U.S. Dollar has begun a long-term downwards trend, which helps the rise here, but the real trend is in almost all “risky” assets rising higher, and Bitcoin is a risky asset.
The action over recent days has been less bullish, but we still see key support levels forming higher and mostly holding up well.
The two support levels closest to the price now look strong and likely to hold if tested, making long trade entries from bounces there attractive.
However, bulls should be wary of the fact that the high prices one year ago peaked just above $12,000 meaning that although this is not technically a resistance level, the price may well struggle to get much higher than $12,000.
For this reason, I am ready to take a small long trade from a bounce at support, but I will take a full-size long trade if we get two consecutive hourly closes above $12,100 later today.
There is nothing of high importance due today regarding the USD.