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We’re very enthusiastic about Bitcoin, but before you become a seasoned
veterinarian veteran in the crypto army, the first thing to learn is responsible and safe trading. The last thing we want is for you to learn everything there is to learn and then lose the money you worked (or played) so hard for by making a fundamental mistake like not diversifying or picking the wrong exchange or whatever.
Thanks for reading the warning! Now that the official part is over, let’s get down to learning what a bitcoin price pattern is and what to do with it.
Bitcoin price charts: technical analysis
You probably know what Forex is. Trading crypto works in the same way (although there are differences, fundamentally it’s the same principle). If you want to learn more about the basics or in general if you’re going to learn everything there is to know, we thoroughly recommend amazing Paddy Hirsch.
There’s also tons of stuff on Forex in the channel too, and great information on hedge funds and institutional trading which you will probably find interesting.
Bitcoin chart patterns: telling one apart from another
How do patterns work? The fundamentals are: the vertical axis is the price. If the line is climbing, good. What you want is to buy cheap and sell expensive. That’s an often repeating scenario that traders use.
There are more ways to make money. You can make use of the price going down (bullish pattern), on corrections, on lightning-fast scalping techniques, and so on, but for now, what matters is predicting if the price is going up or not.
My wife and I like playing with candles
Candles are one of the most popular trading methods. Candlesticks, or candles for short, are ways of representing asset movements including open and closing prices of an asset during a specific period. The period can be set to 1 minute, a day, or more. The candles on the chart will represent the prices and the movement behind them.
Using candles you can start analyzing price patterns to see where the price is likely to be going. For more detailed info on candles check out this video.
Here is a quick look at patterns before we go over examples one by one.
Bullish Patterns (price going up)
Strong vertical rally. Strong movement up. Bulls are intensely buying. String asset rise.
Measured move up
Explosive move up follows this pattern that denotes a pause between powerful growth cycles. Looks like two parallel trend lines as the asset is consolidating, getting ready for the next move. Look, like, you guessed it, a flag.
Indicates the breakout from the upper trendline. Symmetrical lines are aiming towards the center point.
Bulkowski’s Ascending Scallops
This erotic trend looks like a letter J. Upward movement starts after a close after the higher high.
3 Rising Valleys
This trend speaks for itself – look for 3 rising valleys, each above the one before.
Cup with Handle
The cup, as you can see, is u-shaped. Buying orders place at the upper part of the handle is advised.
The price breaking at the top of the pattern signals a long trade.
This bullish reversal pattern features.
Bearish Patterns (price going down)
- Symmetric triangle.
- 3 descending peaks.
- Descending scallop.
- Descending triangle.
- Inverted Cup with handle.
- Measured move down.
Same as above, but turned upside down.
Head and shoulders
This reversal pattern ahs nothing to do with shampooing and everything to do with looking like a person’s head and shoulders. With a little imagination, you can probably see what we’re talking about here although, honestly, it’s a real stretch.
This erotic pattern also signals a reversal, although not always, and looks like, ahem, а bottom – or, if you like, two downward triangles.
Tough to spot though it may be, this pattern looks like a diamond tilted to the site.
Two parallel trendlines, price moves up and down. Needs to touch one line at least 34 times and the other 2 with distinct valleys, to count.
Real Chart Examples
See if you can guess what these are:
Anything else you want to know about Bitcoin chart patterns? Hit us up on social networks or let our support know how you’re doing. We’re always happy to hear from you.
Now that you know more about Bitcoin price patterns, there are 2 things left to do.
One. Remember that projections from past results don’t guarantee results in the future. Patterns don’t provide hardcore guarantees of anything, although they are often indicative of something.
Two. Try these out in a safe place. Nominex offers demo trading where you can try working with these models and find out their effectiveness without losing money.
All these patterns come with data about how much of the time they turn out to be right. Be prepared! Trade responsibly.