This morning, we commented on the strange action we had seen in the Bitcoin price overnight, and on the frailty of any real bias in the wake of the Federal reserve’s latest decision to raise the US base rate by 0.25%. We said that—as a result of the uncertainty surrounding the implications of the US rate hike—we were going to reign in our key levels and incorporate a really tight breakout strategy, chasing short targets in a scalp-like fashion.
This way, even if the price put us in a trade and then reversed quickly, we’d have a good chance of hitting our target (since it is a small, tight trade) or being taken out of the trade for just a small loss, somewhere in the region of a few dollars on our intra-range stop loss placement. In light of today’s action, and taking into consideration that very little has changed from a fundamental perspective, we are going to maintain this approach as we head into tonight’s Asian session and beyond—at least until we either get a considerable breakout (in either direction) or until we get some reprieve over the weekend.
So, without any further ado, here’s what we are looking at in the Bitcoin price this evening.
As you can see from the chart, we broke out of our predefined range to the downside a little earlier this afternoon, and as such, we are still in a short trade towards $450.26. We wont be entering any further trades as a result, but let’s look at things hypothetically.
In term support sits at our target of $450.26, while broken support turns into resistance at $454.92. A break of support will put us short towards $445 flat, with a mid-range stop defining our risk. Looking the other way, a break of resistance will validate a short term upside entry towards $458.91—the most recent swing high. Stop in the same place as the short trade, and let’s see how this plays out…
Charts courtesy of Trading View.