BTC/USD Forex Signal - Thursday, Feb. 1

Yesterday’s signals were not triggered, as the price never quite reached the key resistance level identified at $10,370.

Today’s BTC/USD Signals

Risk 1.00% per trade.

Trades can be entered at any hour.

Long Trades

Long entry after a bullish price action reversal on the H1 time frame following the next touch of $8,976 or $7,837.

Put the stop loss 1 pip below the local swing low.

Adjust the stop loss to break even once the trade is $200 in profit by price.

Take off 50% of the position as profit when the trade is $200 in profit by price and leave the remainder of the position to ride.

Short Trades

Short entry after a bearish price action reversal on the H1 time frame following the next touch of $10,790, $11,000 or $11,379.

Put the stop loss 1 pip above the local swing high.

Adjust the stop loss to break even once the trade is $200 in profit by price.

Take off 50% of the position as profit when the trade is $200 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 I was holding a bearish bias on Bitcoin, and that if the price now became established below $10,000 it would probably continue down to at least the next support level below $9,000. The price certainly fell more yesterday than it rose, but crucially looking at the chart below it did not get “established” below $10,000, instead flitting backwards and forwards in that price area, and eventually forming a small bullish structure based on $9,750. This suggests that buyers are increasingly stepping in below $10,000 and it now looks as if the price can rise, at least over the short term. Therefore, if the price turns and breaks below the lows of this small structure, it will be a very bearish sign and be likely to start a rapid fall to the next support below $9,000. A more likely short-term outcome is a move up, which would look more likely to fail at $10,790 or higher, than the lower resistance level at $10,370. There is a very strong confluence of resistance between $11,000 and approximately $11,500. I am bearish over the longer term but would not be surprised if the price holds up today and even breaks the closest resistance level.