Direct from the desk of Dane Williams.
While Bitcoin got smashed yesterday, the move lower was a highly technical one.
In yesterday's blog, I highlighted the possibility of a Bitcoin short setup as BTC/USD approached higher time frame resistance at 10K.
If you missed it, click the link and have a look, or see the abbreviated quotes below.
BTC/USD Hourly:
We have price being rejected off higher time frame resistance and then forming a stepping pattern intraday.
I've marked the first level of short term support turned resistance that is an opportunity to short into.
Let's go over what we had here.
The solid line at 10K is higher time frame resistance that once looked like holding, indicated that we were only looking to trade short.
To get an optimal entry, we zoom into an intraday chart such as the hourly and look for areas of short term support turned resistance to sell into.
In this case, I've marked our short term level with the ray.
These short term retests allow us to confirm that the trend is in fact changing and allows us to improve our risk:reward on these sorts of trades out of sight.
Now take a look at how the trade unfolded.
BTC/USD Hourly Updated:
After the retests of short term resistance, price mad a new low and that big volume seller stepped in and did the rest.
A highly clean, technical move.
All of my trade setups are the same and if you're interested in learning more, then my Gold trade walkthrough from last week is also worth checking out.
Best of probabilities to you,
Dane.
FOREX BROKR | Hive Blog
Higher time frame market analysis.