BTC/USD: $9,731 will be very pivotal
Yesterday’s signals were not triggered, as the bearish price action took place above all the identified resistance levels.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be entered before 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 $9,388 or $9,140.
- 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 Ideas
- Short entry after a bearish price action reversal on the H1 time frame following the next touch of $9,595 or $9,731.
- 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 there was a new bearish price channel, so I was looking to take a bearish bias and short trade once the price broke below the lower trend line so a price less than $8,900.
The price did not make this bearish breakdown, and instead rose quite strongly, but has remained within the bearish channel which can still be seen in the price chart below.
Again, we see that Bitcoin, far from acting as a safe haven, tends to rise when risk sentiment improves (as it did yesterday) and falls when it deteriorates.
The price is quite near the top of the bearish channel, which is good news for traders as it suggests the pivotal area at $9,731 is more likely to be reached soon.
I will definitely take a short trade at a bearish reversal at that price if it happens today, as have a bearish confluence there.
If the price can get established above $9,750 that will be a bullish sign.
A breakdown below $9,388 will be a minor bearish sign, which a break above $9,596 will suggest that the price should continue to rise to reach $9,731 soon.
Regarding the USD, there will be a release of Retail Sales Data at 1:30pm London time, followed by testimony from the Chair of the Federal Reserve before Congress at 3pm.