Yesterday afternoon (European session close) we published an article highlighting the bullish bias we held in BTCUSD, and outlining a target of 239 flat. Throughout the US afternoon, and as markets closed for the evening, price reached this target. Having hit highs just ahead of 240, the bitcoin price corrected a few dollars, and now trades around 238.15. With this said, what are the levels to keep an eye on as we head into the European morning session on an intraday basis? Here is what you need to know.
As the chart shows, we have got a couple of key levels of support to keep an eye on this morning. One is the downward sloping trendline (highlighted in green) and the other a horizontal resistance come support, highlighted in red at 236.08. The two support levels converged around 7 o’clock this morning, and we saw something of a bullish pin on the test.
If support holds, we can expect a run back up to the day’s highs at 240. Before this run occurs, we may get a continuation of the current short-term bearish momentum but don’t expect price to fall far below aforementioned support at 236.
We have had a relatively quiet week so far as far as fundamental interference is concerned, but don’t be surprised if we get something unexpected over the coming few days. In order to protect your capital – fiat or otherwise – against any such interference, a stop loss is essential. The convergence of support at 236 offers up a nice risk management parameter, with a relatively secure stop loss placed just below – somewhere around 235.50 mark. With a 240 target, this parameter also offers us a nice risk reward ratio.
Charts courtesy of Trading View