So last week we saw an incredible amount of volatility in the bitcoin price. From highs in excess of $500, we saw the bitcoin price correct to break $400 to the downside – one of the sharpest losses we have seen to date. As we head into a fresh week’s trading, do we expect this action to continue? Further, if it does, what are the levels we will be keeping an eye on in order to try and draw a profit from our intraday strategy? Take a quick look at the chart below to get an idea of today’s key levels.
As the chart shows, the levels we are watching today are in term support at 360.54 and in term resistance at 373.96. These two levels represent overnight swing lows and highs respectively.
Since we’ve got a reasonably wide range to play with, we will initially look to bring our intrarange strategy in to play. More specifically, if we get a correction from in term resistance at 373.96 we will look to enter short towards a medium term downside target of support at 360.54, with a stop loss just the other side of our entry (somewhere around 376 would work nicely).
If rather than correct, we break to the upside, we will look for a close above resistance to put us in a long entry towards a medium term target of 390.13 – overnight highs and a reasonably optimistic target given recent action.
A break to the downside will offer up an opportunity to take advantage of any bearish momentum. With a close below in term support, we will look to get in short towards a downside target of 355 flat. This is a slightly tighter target than the previous trades, so a tighter stop is warranted – somewhere around 362 will maintain our risk reward profile.
Charts courtesy of Trading View