BTC/USD: No real lower limit below $4,116
Last Thursday’s signals were not triggered, as there was no bullish price action when the price reached the support levels identified at $7,228 and $6,793.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be entered before 5pm Tokyo time Tuesday.
Long Trade Ideas
Long entry after a bullish price action reversal on the H1 time frame following the next touch of $4,116 or $3,000.
Put the stop loss $50 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 after a bearish price action reversal on the H1 time frame following the next touch of $4,912 or $5,937.
Put the stop loss $50 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 last Thursday that the strong risk-off moves in financial markets had hit Bitcoin and were likely to continue to do so. Therefore, I took a bearish bias on Bitcoin. This was an excellent call as the price almost halved in value within a day!
In times of extreme market panic, we see Bitcoin is exposed as a “luxury” asset that bears little relation to anything tangible. Bitcoin bulls have been made to look extremely foolish.
We do however see a key support level at $4,116, which could well produce a double bottom even if over the short-term.
I take a bearish bias here below $4,000 but only as far as the support level at $3,000. If the price can get established below $3,000 then Bitcoin could collapse exponentially.
There is nothing of high importance scheduled for release today regarding the USD.