BTC/USD Forex Signal: More Bullish

Adam Lemon

Bitcoin is price building for another attempt at record highs.

Last Wednesday’s Bitcoin signals were not triggered, as there was no bearish price action when any of the identified resistance levels were first hit that day.

Today's BTC/USD Signal

Risk 0.50% per trade.

Trades may only be entered prior to 5pm Tokyo time Tuesday.

Long Trade Ideas

  • Long entry after a bullish price action reversal on the H1 time frame following the next touch of $57,334, $56,198, $53,634, or $52,664.
  • Put the stop loss $100 below the local swing low.
  • Adjust the stop loss to break even once the trade is $100 in profit by price.
  • Remove 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to ride.

Short Trade Ideas

  • Short entry after a bullish price action reversal on the H1 time frame following the next touch of or $58,449, $59,280, or $61,240.
  • Put the stop loss $100 above the local swing high.
  • Adjust the stop loss to break even once the trade is $100 in profit by price.
  • Remove 50% of the position as profit when the trade is $100 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 last Wednesday that it seemed as if the bullish momentum was slowing down as the price reached an earlier comfort zone between roughly $54k and $57k.

I thought that the thing to watch for next was likely to be whether the nearest support level (identified at $54,398) held or broke down.

I was correct, insofar as the invalidation of that support level, which happened quite quickly, did produce over the next day or two a slightly deeper bearish movement.

However, bullish momentum took off again at the end of the week, starting during Thursday’s New York session.

The price now looks to be making a bullish consolidation, with the resistance at $58,450 looking very pivotal. If the price can get established above that level, it will probably be a good sign that bullish momentum will continue over the short term.

This might be an exciting development, as the price is not far from the all-time high a little way above $61k. If we get a bullish breakout beyond that area, there will be a lot of interest in Bitcoin and a lot of buying which could drive the price considerably higher.

I will take a bullish bias on Bitcoin today if we get two consecutive hourly closes above $58,450.

BTC/USD

Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm 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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