Trade Recommendation: Bitcoin

This is a short term Bitcoin rally trade off the support that has settled in over the last day and a half. We have volatility back for the time being and we will not want to risk a lot here given the price pressure. But with the rules of the system using the time factor we can dip our toe in the warming water and see if we can grab some relief rally profits.

The time factor has to do with the market price trading at a certain level for a reasonable period of time to confirm that the price will continue to move in the stated direction. This is what the ‘A’ up line indicates and represents a volatitiy measurement of BTCUSDT. Given the volatility factor for Bitcoin we will want to see the price trade at or above 6951.00 for at least 15 consectutive minutes.

Use your short term 5 minute charts to confirm this rule. As I mentioned above, we don’t want to risk too much and fortunately the other rule for this type of setup is to place the stop loss at the Opening Range low which is the lower set of white dots against the white background. This makes for a good risk reward trade.

Place the initial stop loss and profit targets stated below.

Entry Price: 6951.00
Stop Loss: 6820.00
Profit Targets: First profit target 7240.00. Second profit target 7490.00. Once price reaches first profit target bring stop loss to breakeven (entry point), then trail the stop loss 300.00 points back as price rallies to second profit target or stopped out.

Disclaimer: The writer owns Litecoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

I am the founder of VirtuesTrading.com, where traders can learn to use my Virtues Trading System. Formerly a Commodity Trading Advisor, I got my start in the Energy and Precious Metals Options & Futures pits of the New York Mercantile Exchange. I operate on the premise of efficient markets, the management of risk through the analyzation of price action and technical indicators. I have a BA in International Relations from the University of Southern California.