Last Thursday’s signals could have been triggered by the large doji candlestick producing a profitable bullish trade, but the action would probable not have looked attractive to most traders at the time.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades must be taken prior to 5pm Tokyo time Tuesday.
Long Trades
Go long at a bullish price action reversal on the H1 time frame following the next touch of $3,936, $3,876 or $3,804.
Place the stop loss 1 pip below the local swing low.
Adjust the stop loss to break even once the trade is $50 in profit by price.
Take off 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to ride.
Short Trade
Go short after a bearish price action reversal on the H1 time frame following the next touch of $4,374.
Place the stop loss 1 pip above the local swing high.
Adjust the stop loss to break even once the trade is $50 in profit by price.
Take off 50% of the position as profit when the trade is $50 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 Thursday that the price needed a breakout on high volatility and when it eventually comes it should be worth riding it. This was a good call as after an initial huge doji candlestick, the price broke upwards to make a high above $4,000, printing higher support levels along the way.
The picture now is generally more bullish, with no resistance to halt a further advance until $4,374. However, the price action of recent hours has suggested a topping out at about $4,000. It looks likely that today’s pivotal level will be $3,936 – a strong bounce here and I would take a bullish bias, but if the price breaks below I would avoid any long trades unless $3,876 survives a test from above later on.
Regarding the USD, there is nothing of high importance due today.