Yesterday’s signals may have produced a long trade from the bullish double inside candle break on the hourly charts following the rejection of the support level I had identified at $3,876. The trade looks very doubtful now so I would exit it right away at approximately break-even.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades may only be taken between 8am New York time Tuesday until 5pm Tokyo time Wednesday.
Long Trades
Long entry at a bullish price action reversal on the H1 time frame following the next touch of $3,876 or $3,804.
Put the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is $50 in profit by price.
Remove 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to run.
Short Trade
Short entry after a bearish price action reversal on the H1 time frame following the next touch of $3,936 or $4,008.
Put the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is $50 in profit by price.
Remove 50% of the position as profit when the trade is $50 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 yesterday that it would be wise not to take a directional bias, unless the price got established above $4,008 (bullish) or below $3,936 (bearish). This was a good call as the break below $3,936 produced a further downwards movement to the next support at $3,876. Recent months have tended to see Bitcoin really respect these technical levels, the challenge in trading this is that the moves often come very quickly and are over fast, with the price spending most of the time hardly moving.
There is no long-term trend, although a look at the daily chart shows a slightly bearish picture, so short trades from rejections of resistance levels are likely to be the best bet – I would take a bearish bias if $3,876 breaks down convincingly or if the price retraces to $3,936 and strongly rejects that level.
Regarding the USD, there will be a release of CB Consumer Confidence data at 2pm London time today.