The Bitcoin-to-USD exchange rate has posted slight gains in the Friday session. Currently, the pair is trading above 6300-fiat, up +1.55 percent on the day.
The weak upside correction comes after the mainstream stocks underperformed second-day in a row. Nevertheless, the lower market volatility suggests that the Bitcoin correction is only a minor adjustment in price within an overall downtrend. The weekend break in the mainstream market could allow some speculators to switch to crypto’s 24/7 open bazaar, and improve intraday volume.
The prevailing bearish bias indicates BTC/USD to continue its downward trend. That said, we are looking a breakdown action below the lower trendline of our medium-term triangle formation following a short consolidation period on daily charts. Nevertheless, a break below the lower trendline would bring us to a bear trap, meaning BTC/USD could still be able to hold on to its bulls around the support zone below 600-fiat. A well-documented bottom, 6000-fiat could provide the pair a much-needed upside to retain attractive long opportunities as above as 6500-fiat, our substantial resistance level from August and September.
The RSI and Stochastic actions are hinting a further downside break into the oversold regions, followed by a sharp bounce back scenario. At the same time, invalidating support range below 6000-fiat could push BTC/USD to as low as 5450-fiat, the low from November 12, 2017.
The choppy action in the past 24 hours is making it difficult for us to look for ideal long/short positions. So, we are looking at 6300-fiat as our ideal support level, the low of at least three candles since yesterday. Our resistance for the day is a comparatively stronger 6375-fiat. We will avoid intrarange strategy.
That said, a break below 6300-fiat would allow us to set an easy short target towards 6253-fiat, while a stop loss around 6305-fiat will protect our position from additional losses if the 6300-fiat finds bulls somehow.
Similarly, a break above 6375-fiat would have us repeat our strategy from September 19. That said, a placing a long position towards 6445-fiat while managing risks by maintaining a stop loss order just below the entry point (4-pips is ideal).
Featured Image from Shutterstock. Charts from TradingView.