Bitcoin at $6,382 continued to trend sideways on a low volume and low volatility Tuesday.
The BTC/USD is trading between 6450-fiat and 6360-fiat, offering enough space to make decent intrarange profits for day traders. A pullback from upside is bringing a decent short opportunity towards the downside. Similarly, a bounce back from the downside is bringing a similarly profitable long opportunity towards the upside.
Not many dollars are coming into the Bitcoin market. The USD index is fairly bullish against the quoted assets, including currencies, stocks and commodities alike. USD/JPY, for instance, has established its strongest level in 11 months. EUR/USD has also declined for the sixth consecutive day. Comparatively, Bitcoin is steadier against the US dollar considering the digital currency’s intrinsic volatility.
The pair on 4H Coinbase chart is losing its bullish steam. It is trending below its 100H and 200H simple moving averages, while RSI, the momentum indicator, is also dipping into the selling area. The Stochastic Oscillator, meanwhile, is close to entering the oversold region, awaiting a pullback.
Trading volume is a major factor behind the dismissal performance. Though improved, the BTC/USD transactions remain below $4 billion in the past 24 hours. For a bias-defining rally, the volume needs to be way above the said level. Bitcoin volatility index, at the same time, is at its yearly low.
Overall, the Bitcoin market remains inside a bearish bias.
The range we are watching for today is defined by 6450-fiat as interim resistance and 6360-fiat as interim support. Like discussed above, our priority is to keep our intraday positions inside the range. As the price fluctuates between the said upside and downsides, our long and short positions will keep yielding small profits. Nevertheless, placing a stop loss order just 2-pips in the opposite direction of the entry position – long or short – would minimize the risks.
A breakout action looks unlikely due to macroeconomic factors. Nevertheless, we’ll keep our eyes on any possible break above the resistance to enter a long position towards 6549-fiat, our primary upside target in near-term. Meanwhile, a stop loss order 2-pips below the entry position would define our risk management strategy.
Conversely, a breakdown below interim support will allow us to open a short entry towards 6300-fiat, our psychological downside target. Placing a stop loss order just three-pips above the entry position would ensure we stay secure from a potential upside correction.
Featured Image from Shutterstock. Charts from TradingView.