Towards the end of last week, we published a piece highlighting the upward sloping channel that formed in the bitcoin price and the breakout we expected to take place shortly before we close for the weekend. A look at the bitcoin price chart that details weakened action, and we can see that this breakout validated, and offered up a medium-term bearish bias in the BTCUSD.
This said, what are the levels to keep an eye on as we head into a fresh week of trading? Take a look at the chart. As you can see, we are currently trading just ahead of 291 flat, having sustained a sharp and consistent uptrend from floors around 283 we saw yesterday evening (UK time). We like to see this uptrend hold throughout Monday’s European session, but we believe that there may be a medium-term correction before any further gains are made. In term support at 289.07 and resistance at 219.53 of the levels to watch. If we get a break below the highlighted trendline, look for a downside run towards support, and a bounce from 289.07. Conversely, if channel support holds, look for some bullish momentum from current levels. Both scenarios have an initial upside target of 292.53, meaning the former i.e. the break and run down before bounce, offers up favourable risk management parameters. A long entry at 289.07 with a stop loss just shy of this level (i.e. somewhere around 288 flat) would presenters with the better part of five dollars potential gain.
If we can break 292.53 today, we expect to 95 to hold as a secondary upside target, with the obvious 300 level coming into play after this. As mentioned, risk management is paramount – especially after a strong uptrend like that we have seen this morning.
Charts courtesy of Trading View