Bitcoin Futures Price Prediction and Trade Strategy

TradeCompass for Bitcoin Futures: January 24, 2025 – Bitcoin Futures Price Prediction and Strategy

Prediction and Strategy Summary for Bitcoin Futures:

• Bias: Slightly bearish, focusing on fading a potential breakout in Bitcoin futures.
• Approach: Wait for Bitcoin price to approach a higher resistance level (trap bulls) before initiating a short trade.
• Entry: Short at 107,020 (1.65% above current price at 105,300).
• Stop-Loss: 108,845 (1.71% above entry).
• First Partial Profit Target for Bitcoin Futures: 104,915 (1.15 R/R). BUT THIS IS ONLY HALF PART OF THE STORY AS YOU TAKE OFF ONLY HALF OF THE POSITION HERE

• The above plan might not get exected. Bitcoin futures price needs to rise to fill the short order.
• Final Targets for Bitcoin Futures: Multiple levels provided for the remaining position (see below).

Detailed Bitcoin Futures Strategy Plan:

1. Market Context for Bitcoin Futures:

   • Choppy Conditions: With Friday options expiries, Bitcoin futures are prone to jittery or stop-hunting moves.
   • Value Area Analysis for Bitcoin Futures: Yesterday’s Value Area Low (VAL) at 102,870 and Value Area High (VAH) at 105,780 are key price levels for Bitcoin futures. Price is currently near the upper edge of this range, making a short setup at resistance more favorable.

2. Key Levels for Entry and Stop-Loss in Bitcoin Futures:

   • Short Entry for Bitcoin Futures: 107,020
     • This is above yesterday’s VAH and near a level where bulls might be trapped.
   • Stop-Loss for Bitcoin Futures: 108,845
     • Positioned above the 3rd Upper Standard Deviation of VWAP (yesterday) to account for potential stop-hunting.

3. Profit Targets for Bitcoin Futures (Swing Trade):

   • First Target (50% of Position) for Bitcoin Futures: 104,915
     • Just above today’s VWAP and above yesterday’s VWAP, offering a 1.15 reward-to-risk ratio for the initial phase.
   • Additional Targets for Bitcoin Futures (For Remaining Position):
     • 104,580 – Above yesterday’s VAL and VWAP.
     • 103,825 – Close to strong intraday support for Bitcoin futures.
     • 102,565 – Above the 3rd lower standard deviation of today’s VWAP.
     • 101,915 – Below yesterday’s VAL (January 21st).
     • 98,855 – Below the psychological 100,000 round number, aligned with the January 20th VAL.

4. Why Wait for Higher Levels to Short Bitcoin Futures?

   • Trapping Bulls in Bitcoin Futures: The level at 107,020 could attract buyers, increasing the likelihood of a pullback.
   • Avoiding Choppy Action in Bitcoin Futures: Immediate shorts near today’s VAH (105,780) could risk getting stopped out due to the current stop-hunting environment.
   • Patience for Precision in Bitcoin Futures Trading: By waiting for a better entry point, the trade offers a higher probability of success, even if it risks not being filled.

Trade Rationale for This Bitcoin Futures Analysis:

This setup focuses on fading the move in Bitcoin futures rather than betting on a breakout. Bitcoin is trading near the top of its recent range, and a push above yesterday’s VAH could lure bulls into the market. By entering short at 107,020, you position yourself to capitalize on a potential reversal from overextended levels.

Disclaimer for Bitcoin Futures Trading:

This analysis is for educational purposes only. Always use proper risk management and trade Bitcoin futures at your own risk.Visit ForexLive.com for additional views.

This article was written by Itai Levitan at www.forexlive.com.