In this morning’s analysis, we looked at the overnight gains we had seen in the bitcoin price on Tuesday night, and suggested that we may see some extension of this overarching bullish momentum in the bitcoin price during today’s European session. A couple of Fundamental drivers, including the ECB weighing in on the blockchain and its applications via this report and IBM detailing its blockchain strategy through this press release have translated to some bullish sentiment, and this has likely driven the gains. We don’t tend to focus on the fundamental aspect of the market for the purposes of this analysis, but it’s always good to be aware of the general bias. Why? Because it gives us some insight that we can use to judge aggression from a targets and stop loss perspective.
Anyway, getting back to today’s technical action, our strategy put us long towards a scalp target a little earlier on, and we took out our target a short while ago for a circa $6 per unit profit. As we head into this evening’s session in Europe, and beyond into the Asian session, what are we looking at in the bitcoin price from a breakout perspective? As always, get a look at the chart below before we get going to see the range we’re focusing on.
As the chart shows, the range is defined by broken resistance turned support at 414.67, and in term resistance coming from the latest swing high at 420 flat.
If we get a continuation of the current strength, and manage to close above in term resistance on the intraday chart, we’ll get in to a long trade and target 425 flat. A stop at current levels (circa 418) will define our risk.
Looking to the south side, if we close below support we’ll enter long towards 407.73 (this morning’s in term support). A stop somewhere around 416.5 narrows the upside risk.
Charts courtesy of Trading View