We are using the simple trading technical analysis for developing trading strategies and entry and exit points for all of the instruments traded on the market in various asset classes. Today we want to show you an emerging trading set-up in Bitcoin using our well developedtop-down trading technical analysis.
On a monthly chart, we can see a large bearish shadow reversal pattern from the 20000 level. The downside has strong support at 10000-11000 zone which is holding the instrument from breaking higher. The downside target from here, for this swing lower which is more visible in the lower timeframes, is 1150 level.
On the weekly chart, we have still the uptrend supported by the 7700 uptrend line support level. This level is the key for a downside continuation into our targeted bearish area visible on the lower timeframe charts.
From the latest two charts, our strategy will be based on the Bitcoin selling as long as it is below the 10000 level. The daily chart below reveals a clear break and close below the 200 SMA (blue line) which is the valid indicator for us that the uptrend has been violated and another swing down in cryptocurrencies is starting.
As our top-down analysis has indicated, the bearish strategy, based on the uptrend violation and the key levels rejection, we will use the H4 chart below for the trade entry and target determination.
Enter the sell trade at the market with the stop loss at 9080 level and set the take profit target in the 4800-5000 zone. The risk-reward for this trade is almost 1:4.5. Low-risk trade entry with the above 80% probability of success.
Through time we have developed a very respectable trading strategy which defines Entry, Stop Loss and Take Profit levels with high accuracy and allows you to make position Risk Free. If you want to learn all about it and become a professional Trader, sign up now we are accepting Bitcoins!
