BITCOIN ON ITS WAY UP TO ATH. TECHNICAL ANALYSIS + TRADE PLAN Technical Analysis + TRADE PLAN by Blaž Fabjan.
The image highlights an ascending triangle pattern. This is generally a bullish continuation pattern, especially if formed after an uptrend (as indicated in the chart).
The price is consolidating near the resistance level, and a breakout is expected.
Resistance and Support Levels:
Resistance at $73,655.67: This is the key area the price needs to break above for a significant upward move.
Support levels are marked at $68,556.87 and lower at $66,333.98.
Price is currently hovering around $69,000.
Indicators:
VMC Cipher B: There are divergence signals, which often hint at potential reversals or strong continuation. The current setting shows a neutral position, but the past few signals indicate potential upward momentum.
RSI (14): Currently at 67.42, close to the overbought zone (70). This suggests momentum but also indicates that caution should be exercised as it approaches overbought conditions.
Stochastic RSI (14): Shows a reading of 72.43, also close to the overbought region. This is a confirming signal for potential bullishness but requires monitoring to avoid overextension.
HMA Histogram: Shows bullish momentum (green) but with signs of weakening. This is typical before a breakout but worth monitoring.
Volume:
The volume remains neutral but could spike during the breakout above the resistance zone, further confirming the pattern.
Trading Plan:
Entry Strategy:
Aggressive traders: Could consider entering a long position now, given the ascending triangle pattern and anticipation of a breakout.
Conservative traders: Wait for a clear breakout above the resistance level at $73,655.67, confirmed by higher volume. Enter long on a retest of this breakout zone.
Stop-Loss Placement:
Place the stop-loss just below the support level at $68,556.87, or slightly lower to $66,333.98 for more conservative risk management.
This will protect against any false breakout or trend reversal.
Target Levels:
First target: $74,000-$75,000 region (as indicated in the image by the upper blue line). This would correspond with a clean breakout.
Second target: If momentum continues, aim for $78,000 - $80,000, which is the next major psychological resistance level.
Risk-Reward Ratio:
Ideally, maintain a risk-reward ratio of 1:3 or higher. For example, risking 1,000 points for a potential reward of 3,000 points, depending on your entry and stop-loss placements.
Exit Strategy:
Partial Profit-Taking: Consider taking partial profits at the first target to lock in gains, moving the stop-loss to breakeven to secure the trade.
Full Exit: Close the position if price action significantly retraces back into the triangle or breaks below support zones.
If the trade reaches the second target zone ($78,000-$80,000), consider a full exit.
Risk Management:
Limit the position size to avoid overexposure. Risk no more than 2-3% of your portfolio per trade.
Use trailing stops to capture more profit as the price moves in your favor.
Market Sentiment and Confirmation:
The ascending triangle and technical indicators are leaning bullish. However, confirming volume on the breakout is essential to avoid false breakouts.
Global economic factors and BTC news should also be considered for additional confirmation, particularly around major support/resistance levels.
By following this trading plan and being mindful of the market conditions, you can take advantage of a potential bullish breakout while maintaining proper risk management.
