It’s Monday morning, and the European session is about to get under way in the bitcoin price. We are going to take a look at how action over the weekend has affected price, and then use this action to have a go at setting up a strategy for today’s session.
Action over the weekend was pretty flat, although we did see something of a slight bearish bias towards the end of Sunday evening. Price swung a little also, meaning we have a pretty solid range to go at this morning.
So, with that out of the way, let’s get to the important stuff. The chart below has our key levels overlaid in green onto around forty-eight hours’ worth of price action. Take a quick look at that before we get started.
As the chart shows, the range in focus for today’s session is defined by in term support to the downside at 580, and in term resistance to the upside at 585 flat. This is a pretty tight range, so we are going to stick with our breakout strategy for this morning. If price moves a little early in the day, and we get an opportunity to widen out our range on the volatility, we will consider bringing our intrarange strategy in to play to compliment our breakout approach. Right now, however, the spread doesn’t quite give us enough room to get in to a position and maintain a decent risk reward profile.
So, looking at breakout, if price closes above in term resistance, we will look to get in long towards an immediate upside target of 590 flat. It’s a pretty tight target, so we need a tight stop. Somewhere in the region of 584 works well.
Looking south, if price closes below support, we’ll get in short towards 575, with a stop at 582 to define our upside risk on the position.
Charts courtesy of SimpleFX