Bitcoin: Bearish breakdown but $9,800 holds for now
Yesterday’s signals produced a long trade from the hourly inside candlestick forming a bullish rejection of the support level at $9,800. It is currently in profit but should be monitored carefully.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades must be taken before 5pm Tokyo time Friday.
Long Trade Idea
Go long at a bullish price action reversal on the H1 time frame following the next touch of $9,500.
Put 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 Idea
Go short after a bearish price action reversal on the H1 time frame following the next touch of $9,974 or $10,152.
Put 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 I saw bearish pressure as building, but bears may find it difficult to push the price below $9,800.
This was an excellent call, as we got the bearish breakdown of the consolidating triangle which then found support at $9,800.
It seems that the price is rebounding from $9,800. If it reverses and ends today below that level, that would be a bearish sign.
A short trade from $9,974 looks attractive if a bearish rejection of that level sets up later, and I would take a bearish bias if that trade opportunity presents itself today.
Regarding the USD, there will be a release of Philly Fed Manufacturing Index data at 1:30pm London time.