OK let’s get right to this today. The bitcoin price has just spiked below a key level that we outlined yesterday evening as being one to watch and returned to trade back within range on the one-minute charts. This is a perfect setup for two types of trades – one that falls nicely within our standard approach and another that we don’t often go at with our intraday strategy but that works nicely with this sort of pattern nonetheless.
So, instead of wasting time looking at what happened overnight, let’s get on the action. As ever, take a quick look at the chart below before we get started. It’s a one-minute candlestick chart and it’s got our key range overlaid in red.
As the chart shows, the range we are looking at for the session this morning comes in as defined by support to the downside at 3904 and resistance to the upside at 3930. We’re going to address the downside position first as that’s looking like it’s going to be the one that breaks first and it’s that one that’s giving us our sense of urgency on this action right now.
Specifically, then, if we see price close below support, we’ll jump in to a short trade towards an immediate downside target of 3860. A stop loss on the position somewhere in the region of 3920 means we’ll be able to jump out of the trade nice and quickly in the event that the market turns against us.
Looking the other way, we are going to watch for a bounce from current levels to get us in long towards the opposing level (so, the resistance we outlined above at 3930) as an upside target. On this one we’re going to place a stop just shy of support to keep risk tight – somewhere around 3890 looks good.
Charts courtesy of Trading View