Ok, so here’s the plan for this evening. The bitcoin price has been pretty steady all day, albeit with a slight downside trend, so we’re going to approach this evening’s market with a little bit of caution. Not because we think we’ll see too much action, but because in the face of the recent volume spikes that came about last week, we may be in for some choppy price movement.
We don’t really need to alter our strategy or anything like that, just make sure that we’ve got some well defined risk management levels in place to keep our downside (or upside, depending on the trade direction) risk under control, and to take us out of a trade in the event that price reverses against our position.
So, with this in mind, let’s get our key levels defined.
The chart below, as usual, is a five-minute candlestick chart. As a quick aesthetic note, we’ve stuck with the black background and the green/white notation. Readers probably don’t care about this to much, but when you stare at these charts for as long as we do, it’s nice to mix things up a little.
Anyway, that said, take a look at the chart and get an idea of where we are looking from a key level perspective.
As the chart shows, we are looking at a range defined by in term support to the downside at 700 flat, and in term resistance to the upside at 706. These levels are pretty well defined, and with the potential for choppy action this evening, we’re going to stick to our guns with a breakout only strategy.
If price breaks resistance, we’ll get in long towards an immediate upside target of 710 flat, with a stop at 704 to define our risk. Conversely, if price breaks support, we’ll be in towards 694. A stop on this one at 702 looks good.
Happy trading!
Charts courtesy of SimpleFX