Bitcoin: More bearish below $7,192
Yesterday’s signals were not triggered, as there was no bullish price action when the support level identified at $7,192 was reached.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades may be taken 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 $7,192, $7,459 or $7,698 or $7,824.
- 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 short trades probably had more potential right now, but a firm rejection of a key level in either direction could be traded. I saw the best possible trade as a short entry following a reversal at $7,459 although I saw standing aside until a breakout as a good course of action too.
This was a pretty good call as I was correct to prefer the short side. The price broke below the lower level of the consolidation zone at $7,192. The picture is more bearish, and I would take a bearish bias if we get a retracement and fresh bearish reversal at any of the nearby resistance levels. The price has considerable room to fall so there is a good chance we will see a nice downwards move over the course of today.
Regarding the USD, there will be a release of the ADP Non-Farm Employment Change forecast at 1:15pm London time, followed by ISM Non-Manufacturing PMI data at 3pm.