ForexMinute.com — The recent volatility spike in the Bitcoin market proved bullish for the digital currency, as it comfortably sailed above 250 fiat first time since August 2015.
The price spike came almost abruptly when Bitcoin was trending sideways in the range we discussed in our previous analysis. For obvious reasons, we had kept our hopes low from such sluggish price action. But, at the same time, we have drawn levels to indicate our entry/exit position should a breakout takes place.
And as it looks, our levels stood well in times of bull run. We were able to enter a long position towards our primary upside target which, in the end, turned out to be market’s intraday high. Bitcoin did get aggressively sold after establishing its monthly peak, but is now within a safe parameter. What are these levels? Let’s check out:
Bitcoin 4H Chart
As you can see the 4H BTC-e chart, we are now in the midst of a new trading range, where 249.13 fiat is serving as our latest in-term support and 253.43 as in-term resistance level. At this point of time, we are given with two scenarios: either price can retain its upside momentum or it can fall into a corrective phase. In both these scenarios, we will have to apply our intraday breakout strategy to maintain the overall risk assessment.
At first, we will be hoping to play within the range, considering it is wider than the last one and offers enough intraday opportunities for day traders. A run towards in-term resistance line meanwhile will have us put our long position towards 256.66. On this trade, our stop loss will be maintained near 252.40 fiat to ensure a positive reward profile.
Looking the other way, if an extended correction breaks below in-term support, then we’ll enter a short position towards 247.99, our medium-term downside target. On this trade, our stop loss will be at 249.89 fiat to get us out of the market without being chopped.