Bitcoin: Strong bullish breakout to 5-month high of $13k
Yesterday’s signals were not triggered, as there was no bearish price action at any of the resistance levels which were reached.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades must be taken prior to 5pm Tokyo time Thursday.
Long Trades
Long entry at a bullish price action reversal on the H1 time frame following the next touch of $11,781 or $11,508.
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 Trades
Short entry after a bearish price action reversal on the H1 time frame following the next touch of $13,006, $13,116, $13,417.
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 despite all the good reasons to be bullish, the price chart showed that after moving through quite a lot of “blue sky” breakout territory, the price faced a bunch of resistance levels between $11,500 and $11,864. I thought the price would need to retrace for a while before being able to break up solidly above this area, but also that if the price could break up above $11,864 that would be an extremely bullish sign that prices would be likely to get much higher still.
This was a good call as we had a strong move that cut right through this entire cluster of resistance levels like a knife through butter, and I was correct in thinking this would continue to push the price up higher, with the bullish momentum pushing it up further to reach a new 5-month high at $13,000.
The outlook is certainly bullish, but the price may need to consolidate below $13,000 for a while before it will be able to rise much higher. Be very careful about taking a short trade from $13,006 or $13,116 – only do it if the rejection looks especially strong.
Concerning the USD, there will be a release of Core Durable Goods Orders data at 1:30pm London time.