Bitcoin had a sharp reversal movement early morning today. This movement is creating an engulfing candle in the daily chart. The hourly chart shows a complex reversal formation followed by a large bullish candle which creates a morning star figure on strong volume.
The Next hourly candle pierces through the upper limit of the channel and also through the red descending trendline that marks the mid-term downward trend. The following candlesticks are creating a consolidating triangular structure that basically is a continuation signal.
The trade shows a 4:1 RR and the current momentum is bullish, therefore this is basically a trend-following trade.
Key levels of the trade:
- Long entry level:7000
- Stop-loss: 6,890
- Take profit: 7,400
Risk:
- 1 BTC: $110
- 0.1 BTC: $11
- 0.01 BTC:$1.1
Reward: About 4x the risk.
