BTC/USD: Bulls in doubt below $9,200
Yesterday’s signals were not triggered as there was no bearish price action when the resistance levels at $8,748 and $8,992 were reached.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be entered prior to 5pm Tokyo time Wednesday.
Long Trade Ideas
Long entry after a bullish price action reversal on the H1 time frame following the next touch of $8,992, $8,748, or $8,375.
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
Short entry after a bearish price action reversal on the H1 time frame following the next touch of $9,151.
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 would be happy to take a long trade from a bullish bounce at $8,375 or a short trade from a bearish rejection of $8,992 or even $9,150, as these areas were roughly confluent with the trend lines making up the consolidating triangle, which I thought was likely to hold. I was wrong, as in the last few hours of the Asian session, the upper trend line of the triangle was broken, which is a bullish sign. However, no entry signals were generated, so it was enough to keep out of trouble.
The break above the descending trend line, and the apparent flipping of resistance levels to become new support, suggests a bullish breakout is happening. The problem for bulls is that the breakout seems to have no momentum so far, and there are bearish inflection points above the current price at $9,200 and $9,500 and of course the key resistance level at $9,150 continues to sit strong.
I believe we need to see this breakout continue with momentum to take a strong bullish bias and so I want to see two consecutive hourly closes above $9,150 in order to take a bullish bias here.
Concerning the USD, there will be a release of ISM Non-Manufacturing PMI data at 3pm London time.