Advertisement
Advertisement
Where are the Next Resistance and Support Levels for Bitcoin?
By:
BTCUSD: Recent bearish pin bar means very little in light of the broader bullish structure that has been in place since the break of the 6425 resistance level weeks ago.
Currently, the 8400 minor support needs to be taken out in order for a new sell signal to go into effect based on our long only swing trade strategy. This does NOT mean we go short, or even react, but it does provide a point of reference for those who prefer to reduce risk or take partial profits if long from lower prices.
The 7300 level is the key support that needs to stay intact in order for us to maintain a bullish outlook. IF price retraces to this area, it will provide an attractive inflection point to consider a new swing trade long idea (upon confirmation). Until this type of opportunity presents itself, we let our winners run, with our next target at 9750, followed by a third target in the next resistance zone (10K area).
ALSO, this is what we shared previously, for your reference:
Low 7K resistance area has asserted itself, BUT price is more likely to push higher in its next bullish retrace. Why? The 6425 level was a key resistance that once taken out, offered some kind of PROOF that the balance of order flow leans more toward the bullish side. The recent indecisive price action is consistent with this idea so far. Sell offs are not “stop and go”, fear is a powerful motivator and buyers do not appear to be getting absorbed around the current price level.
This will NOT be obvious on any oscillator, or any other random art on a chart. It is a concept that is based on price structure, proportions and forecasting methods that project forward, NOT focus on looking back. Does this mean price can’t pull back to 6K? No, but until Bitcoin provides evidence for that scenario to be likely, it is an event that we assign a low probability.
Using predetermined prices
We can do all the analysis in the world and it will not change the fact that markets are highly random. That means things look one way one minute, and then they change. Rules are what allow us to qualify opportunities and filter out NOISE. One of our simplest rules: using predetermined prices to enter or exit a trade. This helps to minimize the effects of emotional decision making and filters out many would be fake outs that often lead to a stop out.
Having preserved that capital allows us to continue to participate in the next quality setup. Evaluating and managing risk should not be confused with evaluating a market.
This article was written by Marc Principato CMT, Executive Director at Greenbridgeinvesting.com.
About the Author
Marc Principatocontributor
Marc has over twenty years of experience in the markets starting out as a Nasdaq day trader during the height of the dot com era.
Advertisement