BTC Overview (Long and Short Term TA)
Trading USDJPY (Actual Trade)
*This article concludes with an actual USD/JPY trade the author made last week. Feel free to review it as an example of a typical trading practice.
BTC has been in a narrow range this week. Also, since the monthly chart has been updated, I will also explain the situation on that.
Even now, rather than a reversal of the long-term trend, I still believe the range width has expanded and the market is still in a range.
It is necessary to continue to monitor the movements of BTC, ETH, and the US100 and respond flexibly to the market environment. It can be said the difficulty of the current market is BTC alone cannot be used to make any judgment. It is important to comprehensively observe each element and make a comprehensive judgment.
Monetary easing is over for now, and funds are being withdrawn from the market, so there is no need to rush to build a long-term long position. Now is the phase to protect funds, not the phase to be on attack.
↓ BTCUSD monthly candlestick chart
Now that the month has changed and it’s August, I’ll start recognizing the environment from the usual monthly chart. Last month (July) it was confirmed as a positive candle, and this month it is temporarily a negative candle. If the price turns positive after this, we can expect a rally to the next upper white resistance box near $26,000. If you are aiming for a positive turnaround scenario, it would be a good idea to go long on the back of the white support box near $22,500, which has seen a recent rally. It looks like it’s not bad to go long on the back even on the daily level, which will be described later. Let’s take a look at the lower interval level.
↓ BTCUSD weekly candlestick chart
This week was in a narrow range. Therefore, we didn’t do much to build new BTC positions.
Specifically, the lower bound is the white support box at $22,500 and the upper bound is around $23,500 where the recent high cannot be broken. As always, the weekly 200MA is still a battlefield, and if the weekly chart settles above the 200MA this week, I think we can build a long position next week as well.
In last week’s article, I stated “as of July 31, when I am writing this article, this month’s monthly candle will close. If this week’s candle closes above the weekly 200MA, it will be possible to build a long position from next week onwards. Also, when looking at the monthly level, if there is a move to test the weekly 200MA, it could become a lower shadow of the monthly candle, so I would like to aim to build a long position next month.” I will continue to follow this policy.
On the other hand, once again, if we consider a slightly longer time axis, whether it reverses or continues to fall, a certain amount of horizontal axis adjustment is necessary, and until then the market should continue in a range. Therefore, I do not believe that this short-term range break has become a trend reversal, and the range width may expand or recur. I think the horizontal axis is still insufficient for the long-term trend to reverse.
↓ BTCUSD daily candlestick chart
Looking at the daily chart, we can see the price has once tried the white box upper limit of $22,500 and is showing a short-term rally. I’m a little skeptical about whether it will continue to turn around, and rather, I think there is a great possibility that it will try the white box lower limit of $22,000 with a wick. I think it would be nice if such a movement reversed and the monthly chart turned positive. If the price deviates from this forecast, it will continue to return to the original range, so there is no need to force oneself into a long position.
USD/JPY Actual Trade
I made a USD/JPY trade this week and think it’s a pretty good sample, so I would like to introduce it.
First, look at the chart just before taking a position. As for how I looked at this chart beforehand, I saw a white support box similar to the one in the following figure.
In other words, I was aiming to go long around this white box.
After that, the price actually dropped close to the target white support box, so I started building long positions. At this time, the movement of the lower leg is important, so let’s take a look.
If you look at the lower leg, you can see it has formed a double bottom. The important thing is to hit this double bottom and start building positions at the place where the double bottom is likely to form (around 14:35 where the cursor is on the chart). From here, a stop loss can be set to the latest low price (first bottom), so even if a stop loss occurs, the loss will be small and you can trade with a good risk reward.
After that, USD/JPY reversed as shown above and I was able to make a profit.