The European session is about to draw to a close, and it has been another eventful day in the bitcoin price. In this morning’s analysis, we noted that action over the last few days had given us plenty to discuss – specifically, the run up towards fresh highs and the subsequent sideways action that we have been trading now for 48 hours or so. As we head into the close of the European session, and into the US afternoon and Asian session beyond that, what are the levels that we are watching in the bitcoin price, and where will we look to get in and out of the markets if action gives us anything to trade? As ever, take a quick look at the chart below to get an idea of what we are watching.
The chart is a 15-minute candlestick chart showing the last 48 hours’ worth of action, with our key levels highlighted in green
As the chart shows, action during today’s session has seen price decline, and we’re now looking at a range defined by 558 to the downside serving as support, and 566 to the upside serving as resistance. We’ve got about eight dollars to play with, so just enough room to bring our intrarange strategy into play. Long at support and short at resistance, stop loss just the other side of the entry to define risk.
Looking at things from a breakout trading perspective, if price breaks and closes above resistance we will enter long towards an initial upside target of 575. Conversely, if price breaks below support, a short entry towards 550 looks good. We need a stop loss on both positions to keep things tight from a risk management point of view. On the first trade, a stop loss somewhere around 564 looks good. On the short trade, 561 defines risk nicely.
Charts courtesy of SimpleFX