Anybody that caught our bitcoin price analysis this morning will know that we were hoping for an upside breakout during the European session today. We were entering the day on the back of a pretty solid upside run and – subsequent to the run – we saw something of a period of consolidation. These periods generally represent a sort of market rebalancing and, in turn, often present an opportunity to take a position ahead of a breakout.
Well, that’s not technically correct. They represent an opportunity to get a strategy in place that tracks any breakout as and when it occurs, meaning that it doesn’t really matter which side of the markets price ends up breaking out on.
As it turns out, we were incorrect in our bias today we were able to use the above-outlined concept to draw a profit from the market nonetheless. Price broke to the downside midafternoon and fell to current levels in and around 4150. With any luck, this will be the bottom of the decline and we will get a bounce from these levels towards intraday highs. However, as ever, we will be ready for a further depreciation if and when it occurs.
So, let’s get some levels outlined for the session tonight. As ever, take a quick look at the chart below before we get started. It is a one-minute candlestick chart and it has our range overlaid in green.
As the chart shows, the range we are looking up for tonight is defined by support to the downside at 4126 and resistance to the upside at 4163. If we see price break above resistance, we will enter long towards an upside target of 4200. Conversely, if we get a close below support, we will jump into a short trade targeting an initial downside target of 4100. We will make sure we have stops in place on both trades to define risk.
Charts courtesy of Trading View