ForexMinute.com — Last 24 hours in the cryptocurrency market saw attempting a bearish breakout from its previously prevailing “narrow” trading range. As a result, the price action has been consistent towards south, breaking key downside levels consecutively to extend the overall bearish bias.
In our previous analysis, we had feared of such a price action and, therefore, had put necessary risk assessment strategies to exit the market in case of an unannounced volatility. We hope our readers were able to exit their trades on time without incurring any heavy loss on their positive return profile. As we enter another day of trading — the speculative Friday and the weekend that comes after — we’ll be setting our ideal exit/entry strategy to make the most out of the current price action. Let’s have a look at the chart first:
Bitcoin 4H Chart
The 4H BitFinex chart above displays Bitcoin in a strong near-term bearish bias, for the price is trending below the 50 and 100H SMAs but, at the same time, is maintaining its positive bias towards the 200H SMA. The 4H RSI, likewise, has dropped below the 40-mark, indicating a huge selling pressure in the market. The MACD indicator also tells a similar story, for its trending inside a serious negative bias as well.
But the real question amid the current price action is, has Bitcoin established a support, or is it going to extend its bearish momentum towards further downside levels. As you can see the chart, the price is clearly attempting a weak correction as of now, and is currently testing 278.64 as its in-term resistance level. Similarly, the foot of this new upside correction is set near 273.86 — our current in-term support level.
Considering the ongoing price action, we are currently looking for Bitcoin to break above 278.64 to establish 284.86 as our primary upside target. On this trade, a stop loss near 274.93 accurately ensures an exit to maintain a positive risk profile, and also to avoid being chopped off much in case of a bias invalidation.
Conversely, a further bearish correction could easily break below the in-term support level near 273.86 which will validate 264.39 as the primary downside target. While entering a short toward the primary line, it would be recommended to place the stop loss near 274.00 to exit the market on time.