Last Monday’s Bitcoin signals produced a short trade from the bearish reversal at the resistance level identified at $54,398, but the overall profit was quite small.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades must be taken before 5pm Tokyo time Thursday.
Long Trade Ideas
- Go long after a bullish price action reversal on the H1 time frame following the next touch of $54,398, $52,664, $51,364, or $50,601.
- Place the stop loss $100 below the local swing low.
- Move the stop loss to break even once the trade is $100 in profit by price.
- Take off 50% of the position as profit when the trade is $100 in profit by price and leave the remainder of the position to run.
Short Trade Ideas
- Go short after a bullish price action reversal on the H1 time frame following the next touch of or $57,334, $58,450, or $59,280.
- Place the stop loss $100 above the local swing high.
- Move the stop loss to break even once the trade is $100 in profit by price.
- Take off 50% of the position as profit when the trade is $100 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 last Monday that we were seeing short-term bullish momentum which may carry through to higher Bitcoin prices over the day. I thought that it looked quite likely that the price would continue to rise to reach the next resistance level identified at $54,398.
This was a good call, as the price rose steadily higher throughout Monday before peaking at that resistance level.
Although the price has broken above a few resistance levels and flipped them cleanly into new probable support – which is a bullish sign – it now seems as if the bullish momentum is slowing down as the price reaches an earlier comfort zone between roughly $54k and $57k.
The first thing to watch for now is likely to be whether the nearest support level (identified at $54,398) holds or breaks down. If it holds, that will be a bullish sign, but as the price is in a comfort zone, it may well struggle to get much higher than $56k.
Bitcoin looks likely to be a good buy if there will be a strong bounce at any support level, but a short trade from $57,334 in the unlikely event that this price is reached later today also looks attractive.
If the price can get established above $57,500 later that will be a very bullish sign.
Regarding the USD, there will be a release of the FOMC Statement and Federal Funds Rate at 7pm, followed by the usual press conference half an hour later.