BTC/USD: Increasing bearish pressure
Yesterday’s signals produced a short trade from the recent bearish rejection of the resistance level identified at $8,766 which is in a small amount of floating profit at the time of writing, but it does not look like a very high-probability trade so it may be wise to take the risk off the trade by closing part of the position for profit.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades must 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 $8,461, $8,375, or $8,216.
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
Go short after a bearish price action reversal on the H1 time frame following the next touch of $8,766 or $9,011.
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 situation would be more bearish below $8,552 and more bullish above $8,766. I took a weakly bullish bias. This would have led to a loss as the support level was broken but it was just a spike, so all that has to be done is move that support down to $8,461.
The technical picture is now a little more bearish as we have had a firm bearish rejection at the nearest resistance level, the price chart below shows the start of a bearish trend line connecting the two major swing highs.
I think bulls and bears are now very evenly matched, so it may be wise to stand aside until we get two consecutive hourly closes either above $8,766 (a bullish sign) or below $8,461 (a bearish sign).
There is nothing of high importance due today concerning the USD.