Cryptocurrency is currently navigating a period of consolidation. While the recent lack of follow-through after Bitcoin’s breakout to multi-month highs has introduced some bearish sentiment, the recent upward momentum suggests the bullish breakout attempt may still be valid. Given Bitcoin’s tendency to respect technical analysis, the charts provide several key indicators for the current trend.
BTC/USD Technical Analysis
The daily chart illustrates ongoing consolidation below a critical resistance zone at $87,293. Following a sharp decline that breached the previous support level of $83,340 and nearly touched the $80,000 psychological mark, Bitcoin staged a robust bullish bounce at $81,630. Since that rejection, the price has trended upward, successfully reclaiming and trading above the former $83,340 support. This recovery serves as a bullish signal, suggesting the consolidation phase has successfully withstood a significant test.
On the hourly timeframe, this pivotal support level can be refined to approximately $83,440. Above this, there is a cluster of resistance levels positioned just below the $85,000 psychological milestone. Bulls must decisively clear the $85,000 mark before they can challenge the major long-term resistance at $87,293.
Bitcoin Price Chart – $83,440 Pivotal Support
Market Commentary
As a trend trader, I am currently holding a long position on Bitcoin using a volatility-based trailing stop. However, for short-term traders, a daily close below $80,000 would serve as a clear signal to exit long positions.
Conversely, a daily close above $87,293—particularly if accompanied by high volatility and a strong candle close near the day’s high—would be a powerful signal to either initiate new long positions or scale into existing ones.
For day or swing traders, an opportunistic strategy would be to look for long entries once the price establishes itself above $85,000, provided the risk-to-reward ratio remains favorable and the entry is relatively close to that level.
Currently, I see no interest in initiating short positions while Bitcoin remains above $80,000.
Review, Support & Resistance Levels
My previous BTC/USD signal from October 7th successfully identified a profitable long trade following the bullish bounce at $80,581.
Today’s BTC/USD Trading Signals
Risk Management: 0.50% per trade.
Trades should be executed before 5pm Tokyo time, Tuesday.
Long Trade Strategies
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Enter long following a bullish price action reversal on the H1 timeframe at the next touch of $83,440, $81,630, or $80,581.
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Set stop loss $100 below the recent local swing low.
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Move stop loss to break even once the trade reaches $100 in price profit.
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Realize 50% of the position at $100 in price profit, letting the remainder run.
Short Trade Strategies
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Enter short following a bearish price action reversal on the H1 timeframe at the next touch of $84,508, $84,975, or $87,293.
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Set stop loss $100 above the recent local swing high.
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Adjust stop loss to break even once the trade reaches $100 in price profit.
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Realize 50% of the position at $100 in price profit, letting the remainder run.
To identify a reliable price action reversal, monitor the hourly close for candlestick patterns such as pin bars, dojis, outside bars, or engulfing candles with a strong close. Using these patterns at key levels can help optimize entry timing.
There are no high-impact economic events scheduled today for Bitcoin or the US Dollar.
