Bitcoin Price Watch; 600 Broke, Profit Taken!

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So this morning we are going to go for something a little different. Over the last couple of weeks we have primarily been focusing on horizontal range bound trading, with a few breakout entries whenever we saw some volatility. This has been a decent strategy, and one that we are going to maintain going forward, but a classical pattern (well, sort of) has formed overnight, so we are going to shuffle things around a little and attempt to trade the pattern before we return to our standard approach.

The pattern in question is a triangle pattern, and it has formed on the fifteen-minute chart. This pattern suggests a consolidation after a big move, and as the chart below shows, the big move in this instance was to the downside overnight. In yesterday’s evening analysis we highlighted the potential for a testing of 600 as support, and this turned out to be a valid highlight – we got in and out of the markets pretty quickly on the break for a decent profit.

Anyway, getting back to today, here’s what we are going for for the session. Take a quick look at the chart below to get an idea of where the triangle comes in to play, and where our key levels outside of the triangle are.

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As the chart shows, the triangle is defined at its extremities by the upper trend line at 546 and the lower point at 476. The way we are going to trade this, is to enter on a break of either of the pattern’s parameters. So, specifically, if we see price break to the downside (through the orange upward sloping line) we will enter short towards 476. If price breaks to the upside (through the horizontal orange line) we will enter long towards 590. A stop just the other side of the entry (around $10) defines risk on each position.

Charts courtesy of SimpleFX

Disclaimer: The information contained herein is not guaranteed, does not purport to be comprehensive and is strictly for information purposes only. It should not be regarded as investment/trading advice. All the information is believed to come from reliable sources. NewsBTC does not warrant the accuracy, correctness, or completeness of information in its analysis and therefore will not be liable for any loss incurred.