Wednesday has been a bit of a strange day in the bitcoin space so far. We are about to call time on the European session and the bitcoin price has spent the last hour or so in a phase of what looks like steady appreciation. This run, however, comes on the back of what was a pretty rough decline and – subsequent to the depreciation – a drawn out period of consolidation. Exactly where things go from here remains to be seen; we could see price take a turn and fall back down to the consolidation level mentioned above. On the other hand, we could see a continuation of the strength we are seeing right now and price run back up to trade in the mid 4000s.
It’s anyone’s guess, but whatever happens, we intend to be ready for it. As usual, we are going to set up some key levels with which we can carry forward into the session this evening and try to draw a profit from the market as and when price breaks through, or bounces from, these levels.
So, take a look at the chart below before we get started. It is a one-minute candlestick chart and it has our range overlaid in red.
As the chart shows, the range we are using for the session this evening is defined by support to the downside at 4021 and resistance to the upside 4049. This is a pretty tight range, especially compared to some of the ranges we have been trading recently, but we are going to stick with breakout for now.
So, if we see a close above resistance at 4049, we will enter a long trade towards an upside target at 4080. Conversely, a close below support will have us in short towards an immediate downside target of 4000 flat.
Let’s see how things play out
Chart courtesy of Trading View