Bitcoin remains motionless as the price enter yet another day of anxious stability.
The Bitcoin-to-dollar exchange rate is extending its sideways consolidation trend. The spike seen at the beginning of this week – mostly because of the Tether crash – is fading aptly in the absence of adequate bullish sentiment, halted near circa 6550-fiat. The push lately brought the pair back towards 6400-fiat where market found a decent bull sentiment. Since then, the price is merely fluctuating inside an almost $150-range.
There is still some bullish fundamentals that could fuel the Bitcoin value in long-term. The United Kingdom Financial Conduct Authority plans to come up with concrete policies on cryptocurrencies sometime next year. It could prove beneficial for institutional investors waiting to enter the crypto market once there are legal protections in place.
The volatility stands mildly near the upper trendline of the giant descending triangle formation, influencing a bias conflict scenario to mature. A breakout is expected amidst a bull trap sentiment, but the stark equilibrium between the bulls and bears is taking the market nowhere, as evidenced by the formation of Doji in today’s and yesterday’s trading session. With it appearing at the top of the trend, a pullback looks like an immediate thing to happen.
The long-term sentiment remains bearish, with BTC/USD still capped under its 100 and 200H simple moving averages. The RSI and the Stochastic, meanwhile, are indicating a neutral sentiment on daily charts.
The sideways action is giving us plenty of range to apply our intrarange strategy. As discussed in our previous analysis, we consecutively placed long and short positions to get the maximum profits we can out of the market. Today also, we are targetting 6476-fiat as our interim resistance level and 6414-fiat as our interim support level. The range is too thin but remains to be our only options to enter and exit trades on small profits, white awaiting breakout.
That said, a pullback from support will have us put a long position towards the resistance. And similarly, a break below the resistance level would have us enter a short position towards the support line. A stop loss just 2-pips will be placed in the opposite direction of the price action to minimize our losses.
In the event of a breakout, our strategy will shift accordingly. That said, a close above the upper trendline of the long descending triangle formation will have us target 6550-fiat as the primary upside while maintaining a stop loss order just 3-pips below the entry position. In case our intrarange action towards the interim support gets executed and we head to an extended downside action, breaking below 6414-fiat and the near-term ascending trendline depicted in saffron, then we’ll open a short position towards the 200H simple moving average as our primary downside target.
Featured Image from Shutterstock. Charts from TradingView.
Last modified: May 20, 2020 5:08 PM