Bitcoin consolidates after reaching a 10-month high price
Yesterday’s signals produced a losing long trade from the bullish pin candlestick on the hourly chart which rejected the support level at $7,813.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades may only be entered before 5pm Tokyo time Thursday.
Long Trades
Go long at a bullish price action reversal on the H1 time frame following the next touch of $7,582, $7,186 or $6,811.
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 Trades
Go short after a bearish price action reversal on the H1 time frame following the next touch of $8,287, $8,436, $8,593 or $8,893.
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 yesterday that the picture here still looked very bullish with the price advancing very strongly over recent days and weeks from long-term lows in a very speculative asset. Nobody knows how far it can go, but there was every reason to expect it will go higher still over the short-term.
I was ready to be bullish above $8,350. This was a good call as the failure to trade above that that has caused a day of consolidation and the invalidation of the support level which was closes to the price this time yesterday.
There is no reason not to be generally bullish just because we have had a day of consolidation. I would take a bullish bias above $8,350 or if there is a strong bullish bounce following a bearish retracement to the $7,582 support level.
Regarding the USD, there will be a release of Retail Sales data at 1:30pm London time.