Bitcoin: Bullish breakout still holding above long-term trend line
Yesterday’s signals were not triggered as although the resistance level identified at $9,489 held the bearish price action was insufficiently strong to give an entry signal.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades may only be entered before 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 $8,893, $8,458, or $8,102.
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 Ideas
Short entry after a bearish price action reversal on the H1 time frame following the next touch of $9,489 or $10,440.
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 there was a short-term bearish sign with new lower resistance forming at $9,489 close to $9,500. It seemed there was selling from $10,000 but it was also true that we had a more bullish situation and the bulls should come back soon if the support at $8,893 held up after it next got tested from above. For this reason, I was still looking to take a bullish bias following a solid bounce at that level later.
I would still apply this analysis today as the price has continued to hold up, although the resistance level at $9,489 held gently. I see the best opportunity as likely to arise on the long side so I would take a bullish bias if we get a bounce at $8,893 and I would not take any short trades today.
There are very important USD data releases due later today which may move the price a little, but Bitcoin volatility is so relatively large in USD terms that it is unlikely to be very significant.
Regarding the USD, there will be releases of ADP Non-Farm Employment Change data at 12:15pm London time, followed by Advance GDP at 12:30pm, and the FOMC Statement / Federal Funds Rate at 6pm then the usual press conference half an hour later.