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Bitcoin’s strong bullish move continues, overcoming a key resistance level and heading for $25k.
Previous BTC/USD Signal
My previous Bitcoin signal on 26th January was not triggered, as none of the key support or resistance levels were reached that day.
Today’s BTC/USD Signals
Risk 0.50% per trade.
Trades must be taken prior to 5pm Tokyo time Tuesday.
Long Trade Ideas
- Long entry after a bullish price action reversal on the H1 timeframe following the next touch of $23,629 or $21,599.
- 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 Ideas
- Short entry after a bearish price action reversal on the H1 timeframe following the next touch of $24,466 or $25,000.
- 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.
- 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 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.
BTC/USD Analysis
I wrote in my previous analysis that it would be a bad idea to look for short trades but that the bullish momentum was likely to weaken, so I saw the best potential opportunity as a bearish retracement back to the closest support level at $21,599.
This was a good call, as the price traded sideways for the day, and has since gone on to rise but only slowly.
The technical picture has become more bullish over the past day and the recent hours, with the price making a new 6-month high yesterday, and over the past few hours getting established above the former resistance level at $23,629 which now seems to have flipped to become new support.
Bitcoin is up by approximately 40% over the month of January 2023, and is definitely in a new long-term bullish trend, suggesting that the best opportunities here will be on the long side.
I will be happy to take a long trade if we get a touch of $23,629 which triggers a firm bullish bounce.
Bulls needs to be aware that there are two resistance levels between the current price and the big round number at $25k which could halt the rise for a considerable time, or even reverse it, so the short-term upside could be limited.
It is again an interesting time to be trading Bitcoin.
There is nothing of high importance scheduled today concerning the US Dollar.
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