BTC/USD: New higher support at $4,912
Yesterday’s signals were not triggered, as there was no bearish price action at $4,912.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades must be taken prior to 5pm Tokyo time Wednesday.
Long Trade Ideas
Go long after a bullish price action reversal on the H1 time frame following the next touch of $4,912, $4,116, $3,807 or $3,000.
Place the stop loss $50 below the local swing low.
Move the stop loss to break even once the trade is $50 in profit by price.
Remove 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to run.
Short Trade Idea
Go short after a bearish price action reversal on the H1 time frame following the next touch of $5,937.
Place the stop loss $50 above the local swing high.
Move the stop loss to break even once the trade is $50 in profit by price.
Remove 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to run.
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 took a bearish bias here below $4,000 but only as far as the support level at $3,000. This turned out to be a good call, enough to keep anyone out of trouble, as the price never got below $4,000.
The collapse in price which I thought might happen yesterday with the strong deterioration we are seeing in stock markets and risk sentiment has not materialized; we are seeing instead a weak bullish retracement which has still been strong enough to print new higher support at $4,912. The bullish retracement may survive for a while, but I think the medium-term and maybe the short-term outlooks are still bearish.
I would take a bearish bias from a bearish reversal following a pullback to the resistance identified at $5,937 which looks like it will act as a very solid resistance level if reached soon. The coronavirus crisis will not end soon and it hard to se risk sentiment improving enough to substantially raise the price of Bitcoin while it lasts.
Concerning the USD, there will be a release of Retail Sales data at 12:30pm London time.