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My previous BTC/USD signal on 18th December produced an excellent, nicely profitable long trade from the hourly inside bar which rejected the key support level at $40,623.
Today’s BTC/USD Signals
Risk 0.75% per trade.
Trades may only be taken prior to 5pm Tokyo time Friday.
Long Trade Ideas
- Go long after a bullish price action reversal on the H1 timeframe following the next touch of $42,814, $42,583, or $41,709.
- Put 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 ride.
Short Trade Idea
- Go short after a bearish price action reversal on the H1 timeframe following the next touch of $44,228.
- Put 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 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 in my previous BTC/USD analysis on Monday last week that Bitcoin might be a good long-term buy at $40,623. This was a good call as it produced a nicely profitable trade, in line with the long-term bullish trend.
The technical picture has now become more bearish as we have seen topping price action around $44,000 with the resistance level at $44,228 looking especially strong. Another sign of consolidation which might be producing a reversal – or a high chance of a reversal – is the narrowing triangle formation which can be seen in the price chart below.
There is still a long-term bullish trend, but it is notable that so many stock indices, currencies, and commodities are breaking to new long-term highs against the US Dollar, while Bitcoin is failing to do so. This is a bearish sign for Bitcoin. Some analysts are speculating that if a Bitcoin ETF is soon approved as expected, it could drive the price of Bitcoin down.
So, there are signs of a bearish reversal, which suggests that a short trade from another touch of the strong resistance level at $44,228 could be a good short trade entry signal.
There is nothing of high importance scheduled today regarding the US Dollar.
Ready to trade our daily Bitcoin signals? Here’s our list of the best Bitcoin brokers worth reviewing.