Bitcoin Price in Recovery Mode – Will it Close the Week on a High Note?
Originally published on: CCN
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February 01, 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.
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
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.