Bitcoin Price in Recovery Mode – Will it Close the Week on a High Note?

By
Yashu Gola @whoisyashu
February 1, 2019

The bitcoin price on Friday posted a modest 0.9 percent surge as it corrected from its ascending channel support level and sought to climb back into bullish territory.

Bitcoin Price Charges Back Toward $3,500

The bitcoin-to-dollar exchange rate (BTC/USD) established its intraday low at $3,371 right at the beginning of the Asian session. The pair consolidated until the European trading hours kicked in, after which it underwent a modest correction. The positive sentiment rippled through the US trading session, during which BTC/USD established an intraday high at $3,458.

The upside correction appeared despite a shocker from Canada. QuadrigaCX, the region’s largest exchange, announced that it had filed for creditor protection after failing to pay $190 million to its customers. The company reportedly holds assets worth $147 million, according to a court document. It also claimed that the exchange had lost access to its cold wallets after the unfortunate demise of its founder Gerald Cotten in December 2018.

BITCOIN 1H CHART | SOURCE: COINBASE, TRADINGVIEW.COM

The bitcoin price remains inside a robust bearish bias owing to its year-long implosion. Nevertheless, for day traders, the digital currency is attracting adequate trading opportunities. The recent price action shows BTC/USD inside an interim ascending channel. The pattern merely represents how the retail traders are looking at the market. Visibly, they are entering long positions toward the channel resistance on a bounce-back from the channel support.

Similarly, traders are entering short orders towards ascending channel support on a pullback from resistance.

The past 24 hours have posted a similar price action, which hints that the next possible target for BTC/USD is above $3,480. At the same time, there is also a strong possibility that the pair would reverse after testing $3,480 – or the 200-period moving average depicted in red. Such price action would have bitcoin close the week on a new high.

We have settled our intraday targets accordingly.

Bitcoin Price Intraday Targets

Source: Shutterstock

We will start the next trading session by setting our breakout target towards the ascending channel resistance – just near $3,480. A stop-loss order 1-pip below the swing high would prevent losses if the trend abruptly reverses.

Meanwhile, we are looking for bitcoin to attempt a pullback from our previous intraday target at $3,448. Any sign of reversal action – a red candlestick, for instance – would have us open a short position towards the 50-period moving average in blue. We will extend our target towards the ascending channel support if we break below the average. In both the cases, we will maintain a stop loss order 1-pip above the local swing high to define our risk management strategy.

Featured Image from Shutterstock. Charts from TradingView.

Tags: Bitcoin