Last Monday’s BTC/USD signal produced a very profitable short trade from the bearish rejection of the key resistance level identified at $66,234.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades may only be entered 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 $56,537 or $54,274.
Place the stop loss $100 below the local swing low.
Adjust 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 Idea
Go short after a bearish price action reversal on the H1 time frame following the next touch of $59,959.
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 direction looked uncertain. I was ready to take a long trade from a couple of setups which did not present themselves as opportunities in the end. I also said that a short trade from a reversal at $66,234 was also possible but I would not be comfortable with that as I think any fall from there will be likely to quickly find support. That was not a good call as this bearish reversal did set up and would have provided an excellent short trade opportunity.
It is clear now that Bitcoin has a more bearish technical picture than it did a week ago, as we have seen the sell-off continue and the price get established below the round number at $60k. In fact, the closest key resistance level is confluent with that number after forming just a fraction below it, and a short trade from a bearish reversal there is looking attractive in the context of a developing bearish trend.
The price is currently close to the support level at $56,537 which may provide at least a short-term bullish trade, but any long trade taken here should be managed conservatively as it is quite likely to be a counter trend trade.
If the price breaks down below that support level and the round number at $55k, that would be a bearish sign suggesting a fall to at least the $50k area is likely to happen.
There is nothing of high importance scheduled for today regarding the USD.