The Bitcoin-to-dollar exchange rate on Friday remained entrenched into the stable territory amid low volume. The BTC/USD is currently trading at 6406-fiat, just 0.42 percent above its intraday low. The pair continues to bounce between a $58 wide range, providing day traders plenty of profitable…
The Bitcoin-to-dollar exchange rate on Friday remained entrenched into the stable territory amid low volume.
The BTC/USD is currently trading at 6406-fiat, just 0.42 percent above its intraday low. The pair continues to bounce between a $58 wide range, providing day traders plenty of profitable opportunities to enter and exit the market on every pullback action. At the same time, the quoted US Dollar index (DXY) recently posted yearly highs at 96.62-fiat but retraced back to the nearby support level at 96.08. The reverse correlation between BTC and DXY continues to stay true.
Fundamentally, the stability is encouraging bulls into believing a steady uptrend in the future. The accumulation sentiment near the so-called bottom around 6000-fiat attests to it. Nevertheless, every extended sideways consolidation results into dramatic price actions in case of bitcoin. So, one shouldn’t be too bullish before breaking critical resistances to the upside.
The zoomed-out version of BTC/USD chart brings the pair back inside the symmetrical triangle formation. The upper trendline of the triangle has capped the BTC/USD upside on two recent occasions. And a bullish action from here could first attempt to break above the triangle pattern and form higher highs towards the 200-hour simple moving average. At least the RSI is pointing in the same direction. The momentum indicator looks geared up to pursue a smooth upside. The Stochastic Oscillator, at the same time, is trending sideways.
The daily sentiment is bullish; monthly, stable; and yearly, bearish.
The intrarange action has given us decent profits on both our long and short positions. The levels discussed in the previous analysis stands correct even today, defined by 6450-fiat as interim resistance, 6392-fiat as intermediate support, and 6360-fiat as interim resistance.
So, once again, we are first placing a long position towards the interim resistance on a bounce back from support, while maintaining a stop loss order 3-pips below the entry position. Once we test the resistance target, we’ll wait for two possible outcomes: a breakout or a pullback. In a breakout scenario, we will open another long position, but this time towards 6473-fiat as our primary upside target. In this position, a stop loss order 3-pips below will define our risk management strategy.
During a pullback, we will open an as usual short position towards the intermediate support level while maintaining a stop loss order 2-pips above the entry point.
Near intermediate support, our focus will remain ripped between on a bounce back towards interim resistance and an extended downside action towards interim support.
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Last modified: January 24, 2020 10:57 PM UTC