Bitcoin on Friday lost almost 3% of its value against the USD in a bearish correction attempt post the latest rally.
The BTC/USD today continued to its downward trend from the previous high around 7132-fiat. The Asian session kept the price under strict watch, so the pair remained stable. But traders started losing patience at the beginning of European session, during which price formed intraday lows towards 6832-fiat – below the psychological support near 6900-fiat. As we now enter the US trading session, BTC/USD is already attempting a bounce back. Let’s see what’s the sentiment like in the technical analysis section as follows.
The BTC/USD value in medium-term continues to trend north. In some of our previous analysis, we had discussed a rising wedge channel formation, whose resistance is proving to be accurate during the prevailing steady uptrend. The channel support, meanwhile, is protecting us from a potential breakout to the downside. As of now, we are still inside the rising wedge following a reversal from the level just shy of the channel resistance. The BTC/USD pair is now flirting with 200H MA for an imminent bounce back towards 6900-fiat, followed by the wedge resistance line. At the same time, the pair is above 100H MA by a considerable distance.
Both the RSI and Stochastic indicators have slipped into the strong selling areas and might continue to do so if we break below the 200H MA. Then a corrective action should follow and retest 6900-fiat to the upside. Or, the price should just reverse from here owing to the overall bullish bias. In either case, we should be prepared to take the maximum profits out of such intraday volatility. Let’s have a read, then.
According to our intraday analysis, the range we are watching today is defined by 6894-fiat as interim resistance and 6826-fiat as interim support. We are first prepared with our breakout strategy on a hint of BTC/USD breaking above 6894-fiat. Should it happen, we will enter a long position towards 6961-fiat, our primary upside target for the day. As we enter the position, we will attempt to reduce our risk by keeping a stop loss 2-pips below the entry point.
In case the near-term bearish correction extends, we will first wait for the price to break below support, and then enter a short towards 6755-fiat, our primary downside target, while keeping stops 4-pips above the entry point to manage our risks.
Featured image from Shutterstock. Charts from TradingView.