BTC/USD: Ascending medium-term price channel
Last Thursday’s signals were not triggered as there was no bearish price action when the resistance levels at $9,292 and $9,384 were first reached.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades must be taken prior to 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 $9,431, $9,316, or $9,063.
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 Idea
Go short after a bearish price action reversal on the H1 time frame following the next touch of $10,131.
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 although the technical picture had become a little more bullish, the price was still being suppressed by the triple top we see rejecting the resistance level at $9,293.
I was ready to take a bullish bias if we had gotten two consecutive hourly closes above $9,384 and this did happen, with the price rising further from that point over the remainder of the day, so this was a good and profitable call.
Since last Thursday we have seen the price advance slightly but slowly. It has become possible to draw a new medium-term ascending price channel (shown within the price chart below) which still contains the price, which is making a bullish consolidation above $9,431.
The lower trend line of the ascending channel is confluent with this level at $9,431, so we have supportive confluence there. As the price is quite close to this level, I think it will be today’s pivotal point, so I would be prepared to enter a long trade from a bullish bounce there if it sets up later today.
The price has plenty of room to rise all the way to $10,000 with no obvious key resistance until that area is reached, although we do have inflection points at $9,600 and at about $9,800 which could produce a resistant effect.
Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm London time.