BTC/USD Forex Signal: Minor Recovery from 2-Year Lows

Today’s pivotal point likely to be $16,727.

Previous BTC/USD Signal

My previous Bitcoin signal on 15th November was not triggered as the price did not reach any of the support or resistance levels which I had identified that day.

Today’s BTC/USD Signals

Risk 0.50% per trade.

Trades must be taken before 5pm Tokyo time Thursday.

Long Trade Ideas

  • Long entry after a bullish price action reversal on the H1 timeframe following the next touch of $16,201 or $13,764.
  • Place 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.
  • Adjust 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 $17,120, $18,107, $19,954 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 15th November that the price of BTC/USD looked likely to present the best opportunities over the medium-term on the short side, but over the short-term it seemed very hard to predict the price movement.

This was a good call as the price chopped around over that day, but then fell further over the next days, to eventually break down to another new 2-year low, before recovering.

This week, we have seen the price recover after trading as low as $15,500 with the current bullish move looking quite impulsive and therefore likely to hold up for a while. This bullish move has also printed two very clear support levels, with the level at $15,945 looking especially strong. Nevertheless, bulls really need to push the price above the nearest resistance level at $16,727 to get real control over the medium-term.

Despite the recent bullishness, you must be brave or prepared to take a long shot as an investment to be buying Bitcoin now, with the strong long-term bearish trend and the FTX debacle generally depressing the crypto sector. I see Bitcoin as likely to reach key support at about $14k before it has a good chance to bottom out and begin to rise meaningfully again.

Today I am prepared to take a short trade if we get a firm bearish reversal from the resistance level at $16,727.

BTC/USD

Concerning the US Dollar, there will be a release of Flash Services data at 2:45pm London time followed by the FOMC Meeting Minutes at 7pm.

Ready to trade our free Forex signals? Here are the best MT4 crypto brokers to choose from.

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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