Trade Recommendation: Bitcoin
Our May 6, 2019 trade recommendation for bitcoin (BTC/USD) hit both targets. This is in addition to the crypto price update on May 3rd. Those who adhered to the trading plan grew their capital by over 35% in a little over a week as BTC rallied to highs of $7,581.82 today, May 12th.
Bitcoin may rise more but you have zero reasons to invest if you feel the fear of missing out. The ascent has been impressive thus far but as we say, markets always pullback. The chart is starting to show signs of exhaustion, including trading in overbought territories in both the daily and weekly charts. We wait for the correction before reentering the market.
Technical analysis shows that BTC/USD has broken out of a rounding bottom pattern on the weekly chart when it breached resistance of $6,400 yesterday. The breakout marks the technical reversal on the longer timeframe. In other words, bitcoin is now bullish from the macro perspective. The bear market that started in 2018 is now officially over.
The monster rally that we’re seeing today is an affirmation of our bias. People are frontrunning each other now that bitcoin bulls are flexing their muscles. However, now is not the best time to open a fresh long position. Wait for this rally to fade and for bitcoin to consolidate.
The strategy is to buy on dips as close to $6,400 support as possible. As long as bitcoin holds this area, bulls will likely ignite a rally to our targets of $8,160 and $9,945.
The process may take more than a month.
Weekly Chart of Bitcoin/US Dollar on Coinbase
As of this writing, the Bitcoin/US Dollar pair is trading at $7,080 on Coinbase.
Summary of Strategy
Buy: On dips as close to $6,400 as possible.
Targets: $8,160 and $9,945.
Disclaimer: The writer owns bitcoin, 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.