BTC/USD: Support at $6,576 probably too strong to break down today
Last Thursday’s signals were not triggered as there was no bullish price action when $7,228 was first reached.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be entered before 5pm Tokyo time Tuesday.
Long Trade Ideas
Go long after a bullish price action reversal on the H1 time frame following the next touch of $6,576, $6,386, or $6,293.
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
Go short after a bearish price action reversal on the H1 time frame following the next touch of $6,973 or $7,182.
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 it made sense to be weakly bullish above $7,000 and more strongly bullish above $7,500. This was an OK call for the day as the price held up above $7,000 and ended the day roughly where it started, so there was no real harm in being bullish.
The price has taken a bearish turn since Thursday, falling quite sharply in recent hours down to the support level at $6,576 where it bounced, but still looks heavy and likely to test that level again. I think it will hit that price, but I would be prepared to take a long trade if it bounces at $6,576.
Alternatively, if the price rises slowly and then makes a bearish failure at $6,973, I will take a short trade.
I think that until the price hits $6,576 the odds will be with the bears, as we already see the $6,754 level becoming bearishly pivotal just over the past few hours – this may be emerging as new lower resistance.
There is nothing of high importance due today concerning the USD.