Earlier today we published a piece that looked at the overnight action in the bitcoin price and forecasted the likely trail price would take throughout the European session. We had 240 – highs seen earlier on in the day – slated as the initial potential upside target. The European session has now closed, and a look at the bitcoin price on an intraday level vindicates our initial target. Now looking forward, action has offered up yet another opportunity to get in at the bottom of what looks to be a short-term correction, and once again ride BTCUSD towards daily highs. Take a look at the chart.
It shows the aforementioned rally taking place just after lunchtime (GMT). From daily lows just ahead of 236 flat, we had nine consecutive bullish candles and hit our short-term target around 2 PM. Since then, we have corrected to trade at the bottom – or close to the bottom – of the daily range – currently around the 238 level.
We expect price to decline a little further, perhaps as low as 236-236.50, before resuming the bullish momentum. If we get a test of range support, and it holds, we will be looking for a medium-term upside target around 241 flat. The nice thing about trading range action is that it offers us simple and effective risk management parameters. Should price fall below 236 it would invalidate this analysis, and we would no longer wish to be in the trade towards an upside target. Therefore, a stop loss just below 236 ensures timely exit in the event of anything unexpected.
We’ve not really had any major fundamental developments today, and so – until we do – intraday bitcoin price will likely follow a relatively predictable pattern. Do you actively trade digital currency? Have any questions for us? Let us know below!
Charts courtesy of Trading View