BTC/USD: Bullish move has probably peaked for now
Yesterday’s signals produced an excellent, profitable long trade from the bullish doji candlestick which rejected the support level identified at $10,123.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be entered prior to 5 pm Tokyo time Wednesday.
Long Trade Ideas
- Long entry after a bullish price action reversal on the H1 time frame following the next touch of $10,696, $10,456, $10,123 or $10,039.
- 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 $10,985.
- 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 very happy to take a long trade from a bullish bounce at either of the support levels I identified above $10,000. This was a great call as the price retraced to the support level at $10,123 to the pip before making a bullish reversal there and producing an excellent long trade which gave multiple times the risk as a potential reward.
The price rose strongly yesterday before making a volatile bullish climax, very similar to what was also seen with silver and gold in USD terms.
The price has pulled back quite deeply which is not a surprise due to the high volatility. Usually, these climaxes mean we will not see higher prices beyond yesterday’s peak for at least a few days, suggesting that the best opportunity today is likely to be on the short side.
Therefore, I am prepared to take a short trade today from a bearish reversal at $10,985, although I do not have very high confidence in the level itself, so a wider than normal stop-loss adjusted for volatility might be helpful in such a trade.
There is nothing of high importance scheduled today regarding the USD.