Previous BTC/USD Signal
My previous signal given Monday last week was not triggered as unfortunately the price did not quite reach the support level I had identified at $32,817 when it made the low of the day.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be taken before 5pm Tokyo time Friday.
Long Trade Ideas
- Long entry after a bullish price action reversal on the H1 timeframe following the next touch of $35,583 or $32,817.
- Put the stop loss $100 below the local swing low.
- Move 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 bearish price action reversal on the H1 timeframe following the next touch of $37,233 $38,047, or $39,642.
- Put the stop loss $100 above the local swing high.
- Move 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 on Monday last week that as the price was breaking strongly below key support levels, there was no reason not to be bearish, and I expected further falls. However, I was waiting to see what happened at the pivotal point of $36,656 to make that determination.
I was looking for the nearest resistance level at $36,656 to hold, which I thought would send the price down to at least $30k if it did, so I saw a good trade opportunity to go short from a bearish bounce at that level.
Surprisingly, the price in the end did get established above $36,656 that day, and this was indeed a sign of less bearishness, so this was a good call. The price has continued to hold up to some extent.
The technical picture now is unclear but showing bearish signs. The short-term price action is bearish, printing new lower resistance levels which continue to hold the price down, and the price seems to be heading for the key support level at $35,583. However, it can also be argued that the price has been making higher lows for more than a week now, so there is a bullish case to be made. It may be significant that the support levels close to $30k have continued to hold. Nevertheless, the fact that the price has remained below the formerly pivotal major round number at $40k is arguably also a significant bearish sign.
I think swing and longer-term traders should be looking for a long trade from a bullish bounce at $35,583 which might set up later, while shorter-term traders should be looking for a short trade from a bearish push off $37,233.
Regarding the USD today, there will be a release of the ADP non-farm employment forecast at 1:15pm London time.