Bitcoin: Bears back in full control
Yesterday’s signals were not triggered as none of the key levels were reached within the specified time.
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 $6,786 or $6,441.
⦁ 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 $6,455 or $7,404.
⦁ 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 thought that $7,404 had a good chance of being the day’s pivotal point so I would be prepared to take a short trade / short bias if we had gotten a bearish reversal at that level. I also noted that we were still in a strong, long-term bearish trend.
This was a good call although unfortunately the price never made it all the way back to $7,404.
The picture is more bearish today and the price is showing short-term bearish momentum. If it breaks through the next support level at $6,786 that would be another bearish sign.
I am prepared to take a short trade at any bearish rejection of a resistance level outlined above. It is significant that the price seems poised to make a new 6-month low.
Regarding the USD, there will be a release of Chicago PMI data at 2:45pm London time.