Bitcoin: 2020 has seen solid long-term buying
Yesterday’s signals produced a profitable long trade from the bullish bounce at $8,966. It is probably worth keeping at least part of such a position open as long as the price trades above the new support level at $9,233.
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 $9,233 or $8,802.
- 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 Idea
- Short entry after a bearish price action reversal on the H1 time frame following the next touch of $9,489.
- 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 the price was resting on new support at $8,966 after making a double top near $9,200 followed by a normal bearish retracement. As long as this level held, I saw the outlook as bullish. This was a great call as the price bounced there on the second attempt then took off to reach a new 2-month high price. I have also been saying that for Bitcoin to rise in value during the recent risk-off market sentiment was a significantly bullish sign.
The picture now is still more bullish technically with the breakout, and beyond the next resistance level at $9,489 the price has even more room to rise with no resistance, although the big round number and psychological level at $10,000 will probably have an effect if it is reached.
I maintain a bullish bias above $9,233.
Concerning the USD, there will be a release of the FOMC Statement and Federal Funds Rate at 7pm London time followed by the usual press conference half an hour later.