Yesterday’s signals may have produced a short trade from the semi-doji candlestick on the hourly chart which rejected the resistance level at $3,876 during yesterday’s New York session. The action is very slow but still looks slightly bearish so there is probably not a strong reason to exit the trade yet.

Today’s BTC/USD Signals

Risk 0.75% per trade.

Trades must be taken prior to 5pm Tokyo time Thursday.

Long Trades

  • Go long at a bullish price action reversal on the H1 time frame following the next touch of $3,804 or $3,552.

  • Place the stop loss 1 pip below the local swing low.

  • Adjust the stop loss to break even once the trade is $50 in profit by price.

  • Take off 50% of the position as profit when the trade is $50 in profit by price and leave the remainder of the position to ride.

Short Trades

  • Go short after a bearish price action reversal on the H1 time frame following the next touch of $3,876 or $3,969.

  • Place the stop loss 1 pip above the local swing high.

  • Adjust the stop loss to break even once the trade is $50 in profit by price.

  • Take off 50% of the position as profit when the trade is $50 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 yesterday that bulls and bears now seemed to be evenly balanced despite the move up from $3,800, with the price currently just below two resistance levels. I ignored $3,858 but thought that $3,875 could be more interesting although I only wanted to take a directional bias after breaks, not reversals.

This was mostly a good call as the price did make a bearish turn at $3,856 from where it is currently moving down to new short-term lows. I still think that the best approach is to be bullish when the price has got above $3,875 for a while or bearish once $3,804 breaks down convincingly and I also think that there is more potential on the downside than the upside.

BTC

Regarding the USD, there will be releases of Core Durable Goods Orders and PPI data at 12:30pm London time.

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