Bitcoin price on Tuesday continued to stay capped by a stiff resistance near $6,500.
The BTC/USD pair started off today with a near-term bullish correction from intraday support near 6232-fiat. The upside looked strong during the Asian trading session and was able to go above 6500-fiat by the afternoon. However, the presence of a firm selling sentiment near the said resistance once again reversed the trend. The European session saw price slipping back to the 6400-ish range following the pullback.
As BTC/USD trends sideways, it has now broken below the ascending triangle. The downside hasn’t been much volatile, so the pair has a very valid potential to renter the triangular zone on a bounce back. If it does, we can consolidate sideways and create higher lows towards 6700-fiat before attempting an upside/downside breakout.
The BTC/USD is currently trading above its 100H and 200H moving averages. The 100H MA is itself above the 200H MA, indicating a lack of bearish action on the hourly BitFinex chart. The RSI and Stochastic indicators, meanwhile, have entered the territory of buying sentimentalists, with their heads down towards the south, indicating the current bearish correction.
Overall, the near-term bias is bullish.
According to our intraday analysis, the range we are watching for today is defined by 6346-fiat as interim support and 6500-fiat as interim resistance. It is quite a narrow one to apply our intrarange strategy so that we will be directly starting with our breakout entries for the rest of the day.
Naturally, we will first wait for the price to retest 6346-fiat. On a bounce back, we will enter a long position directly towards our upside target near 6550-fiat. Placing a stop loss three-pips below the entry position will define our risk management perspective. However, if we continue to go down upon breaking 6346-fiat, we will enter a short position towards 6159-fiat, our downside target, while keeping a stop loss two-pips above the entry position.
There is also a third scenario in our breakout perspective. If price attempts a strong upside correction so that it breaks above 6550-fiat, then we’ll enter a long position towards the ascending channel resistance. In this position, we’ll keep our stops three-pips below the entry position to protect our trades from additional losses should the bias reverses.
Featured image from Shutterstock. Charts from TradingView.