Notes On Bitcoin - Support/Resistance Levels And How I Traded The News
Good evening to all crypto-lovers and traders !
Unfortunately lately I was kind of busy with lots of stuff and I didn't have the time to share my thoughts with you. Few days ago BTC was once again flirting with the 200-day moving average (the green line in the chart below). I wrote a short article on the importance of the 200-day, you can see the post HERE. However Bitcoin didn't manage to break above this key level.
The next day news about the Rejection of the Bitcoin ETF broke and I immediately initiated a small short position in BTC. My price was around 8200$ and I set my stop at 8325$ ( the high of the previous bar). I think the risk/reward in this trade was worth it and in my calculations risk/reward was 1/6 and above. ( You risk 100 for 600).
After my stop was not hit for 12$ (LOL, lucky me) BTC went straight down. When it reached ~7700$ I was ready for some bulls to support the price - it didn't happen. Next support level was a lot more important and relevant - the 7200$ level and today we bounced from it like a charm.
So I guess the interesting thing for you fellow traders is how have I adjusted my stop/loss according to the situation. I moved my stop to 7778$ (above the previous support, which I imagine might turn into resistance once again)
If we break the ~7200$ support I expect a pretty nasty move to below 6000$. If we hold after the 7780$ resistance comes again the 200-day key level test for the crypto king.
I hope this is as informative for you as it is for me while writing it. I will keep you updated if something interesting happens and if I have initiated a new position.
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