Overnight action in the bitcoin price was a little strange. Before the European session shutdown for the evening last night, we published the second of our twice-daily bitcoin price watch pieces, and in the piece, we highlighted what we thought was a relatively tight range as being one to watch from a breakout perspective. Because the range was so tight, we decided not to go at price with an intrarange approach, and – early evening – this seemed to be a solid strategy. We didn’t manage to get into any trades, but we didn’t get chopped out either, and as we noted yesterday morning, sometimes, it’s all just about patience. Fast-forward to early morning out of Europe, however, shortly before markets open, and we see a sharp spike followed by a quick recovery, and a return to the range in which we were initially focused. Classic chop-out.
It’s annoying, but we will move forward into today’s session as if it never happened. So, with this in mind, let’s take a look at some key levels, and see if we can draw profit from the market in an attempt to regain what we lost early morning. As ever, take a quick look at the chart below before we get started. It is a five-minute candlestick chart, and it has our range overlaid in green.
So, as the chart shows, the range of focus for today is defined to the downside by 900, while resistance comes in on the upside at 913. If we see price break above resistance, we will look for a close above this level to validate a short-term upside entry towards an immediate upside target of 920. A stop loss on the trade at 910 kills off any risk. Conversely, a close below support will put us short towards 890. A stop loss on this one at 903 defines risk nicely.
Charts courtesy of SimpleFX