Bitcoin has been consolidating around the 44K support and so far refuses to break lower. The push above 47K is a buy signal, but it is important to accept the elevated risk that comes along with this break out attempt.
From a swing trade perspective, buying just above 47K means RISK is defined from 43K. Putting a stop any tighter dramatically increases the chance of getting stopped out on any random price noise.
What makes this risk “elevated” is the potential for a fake out just above 47K. The 50K area is still a notable resistance which can reassert itself again. IF a bearish reversal appears in this area upon taking a position, an adjustment is warranted. This means you can exit early for a small loss, gain, adjust your stop, etc.
Also keep in mind IF a lower high is established somewhere between 47 and 52K, then a retest of 44K will be very likely. If 44K breaks, then 41K is the next major support level.
These are price scenarios to watch out for IF the resistance holds. IF bullish momentum follows through, it would be a good idea to start taking partial profits once 51K is reached in order to justify the risk.
The more conservative thing to do would be to wait for a clear higher low, or continuation pattern AFTER the 48K area or higher is reached. This at least proves that the bearish momentum relative to the large outside candle off of 52K is no longer in control.
If you would like to know more about our LONG only swing trade strategy, please visit: https://greenbridgeinvesting.com/pricing
We offer a signal service, chat room and 7 day free trial.
Thank you for considering my analysis and perspective. I hope you find it helpful.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
