Bitcoin: More bearish below $8,047
Yesterday’s signals were not triggered, as there was no bullish price action at $8,247.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades must be taken prior to 5pm Tokyo time Thursday.
Long Trade Ideas
- Long entry after a bullish price action reversal on the H1 time frame following the next touch of $8,048 or $7,754.
- Place 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 Ideas
- Short entry after a bearish price action reversal on the H1 time frame following the next touch of $8,247, $8,458, or $8,893.
- Place 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 over the shorter-term, the price was evenly balanced within a narrow range from $8,247 to $8,458. A break above the upper level would be a mildly bullish sign while a break below the lower level would be a little more bearish.
We got the bearish break below the lower level, and the price has continued to basically move down since that break, so this was a reasonably good call.
All else being equal, it looks as if the price will continue downwards and reach the next support level just above $8,000. We have a weak long-term bearish trend.
If the price keeps falling and reaches the $7,750 area, this could be a long-term buying opportunity, as it is a key recent inflective low, should we see a bullish double bottom form here.
Alternatively, if the price breaks lower than $7,750, we could see a strong fall to much lower levels.
I would wait until the $87,750 level is reached before deciding whether to get involved here.
Concerning the USD, there will be a release of Retail Sales data at 1:30pm London time.