Previous BTC/USD Signal
My previous Bitcoin signal on 11th October produced a long trade from the hourly bullish hammer candlestick which rejected the support level identified at $18,927, giving a very marginal profit over the day.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be entered before 5pm Tokyo time Thursday.
Long Trade Ideas
- Go long after a bullish price action reversal on the H1 timeframe following the next touch of $18,996, $18,856, or $18,570.
- Place thee stop loss $100 below the local swing low.
- Adjust the stop loss to break even once the trade is $100 in profit by price.
- Take off 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to run.
Short Trade Ideas
- Go short after a bearish price action reversal on the H1 timeframe following the next touch of $19,463, $19,939, or $20,532.
- Place 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.
- Take off 50% of the position as profit when the trade is $100 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
I wrote in my previous analysis on 11th October that the price of BTC/USD looked likely to
continue its existing consolidation pattern over the near term, and as the price was very close to the support level at $18,927, if the level was touched it could provide an interesting long trade for swing traders or even position traders or investors.
This was a good call insofar as it accurately identified the low of the day, but the price was unable to rise significantly from there and as such it was not a good trade.
The technical picture has changed very little over the past days since then, or even over the past weeks. The price has flattened out in a dull consolidation above the $19k area showing very little price movement or general volatility, making Bitcoin unattractive to traders. It is ironic how things have reversed – last year Forex markets were often relatively dull while cryptocurrencies such as Bitcoin were really moving and proving profit opportunities on both the long and short sides, with very reliable long-term trends. In recent weeks and months, the situation has completely reversed.
I am not a fundamental fan of Bitcoin, seeing it as very over-hyped, but I do think that its reluctance to really get established below $19k does suggest that there may be a more long-term price rise ahead, or at least its more likely to happen than a long-term fall. Therefore, there may be some milage in a longer-term investment in Bitcoin from this price area, but I am not strongly confident in it and would not make this investment myself. For traders, it is hard to get much joy out of Bitcoin now – the Forex market and other asset classes are much more interesting right now.
Concerning the US Dollar, there is nothing of high importance scheduled today.
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