BTC/USD Forex Signal: Stronger Bullish Wedge

 I remain bullish on Bitcoin, but I really want to see the price make a new long-term high price before entering a long trade.

My previous BTC/USD signal on 4^th January produced an excellent, nicely profitable long trade from the hourly inside bar which rejected the key support level identified at $41,709.

 

Today’s BTC/USD Signals

Risk 0.75% per trade.

Trades must be entered before 5pm Tokyo time Friday.

 

Long Trade Ideas

• Long entry after a bullish price action reversal on the H1 timeframe following the next touch of $45,686, $44,648, or $44,508.
• 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.
• Remove 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

• Short entry after a bearish price action reversal on the H1 timeframe following the next touch of $47,170 or $48,555.
• Place the stop loss $100 above the local swing high.
• Adjust the stop loss to break even once the trade is $100 in profit by price.
• Remove 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.

(Click on image to enlarge)

 

BTC/USD Analysis

I wrote in my previous BTC/USD analysis on 4^th January that Bitcoin’s technical picture

remained bullish for two reasons:

1. The price was contained within a wide but symmetrical ascending price channel, which is a bullish sign.
2. The price was clearly not far off the high of a long-term bullish trend.

This was a good call, as the price has continued to advance to new 20-month high prices, breaking bullishly out of its ascending price channel, and forming a new wedge pattern which is a kind of asymmetric price channel. Although this wedge could be seen as bearish, I cannot see it like this until the price breaks below the lower trend line, which is currently sitting at $44,648 confluent with a horizontal support level.

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