Bitcoin: More bullish above broken trend lines
Yesterday’s signals were not triggered, as there was no bearish price action at any of the three key resistance levels which were hit.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades must be entered prior to 5pm Tokyo time Wednesday.
Long Trade Ideas
Go long at a bullish price action reversal on the H1 time frame following the next touch of $10,254, $9,982, or $9,801.
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 Ideas
Go short after a bearish price action reversal on the H1 time frame following the next touch of $10,562 or $10,921.
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 technical picture was still quite bearish. The price was failing to break above the resistance level at $9,801 which seemed certain to be the day’s important pivotal point. I was wrong to be looking towards the bearish side but very correct to see $9,801 as the pivotal point because once the price broke up above it, it just kept going and broke up past two higher key resistance levels.
The price has broken lots of resistance and has also settled above the two broken trend lines shown in the price chart below, which may now become supportive.
The technical picture is considerably more bullish today than it was yesterday, but the resistance level just above the current price at $10,562 also looks very solid and important. I think bulls and bears are evenly balanced between that level and the support at $10,254. However, bulls have the momentum, plus there is confluence with the trend lines and the quarter-level at $10,250, so I would be prepared to take a bullish bias if we get a solid bullish bounce following a retracement to $10,254.
Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm London time.