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Bitcoin Reversal Patterns: Head and Shoulders or Inverse

Head and shoulders Bitcoin Setup

This configuration manifests after a protracted upward trajectory in the BTCUSD cryptocurrency market and signifies a reversal pattern. It is composed of three successive peaks: the left shoulder, the head, and the right shoulder, separated by two relatively slight troughs forming the structure.

This bitcoin setup is done when the bitcoin price goes below the neck-line, which is made by connecting the two low points between the shoulders pattern formation.

To initiate a short 'sell' position, Bitcoin traders place their sell stop orders strategically beneath the identified neckline.

Summary:

  • This Bitcoin pattern forms after an extended move upward
  • This formation shows that there will be a reversal in btcusd cryptocurrency trading market
  • This setup looks like head with shoulders thus its name.
  • To draw the neckline we use chart point 1 & point 2 such as displayed and shown below. We also extend the line in both directions.
  • We sell when bitcoin price breaks out below neck-line: see the chart below for explanation.

Reversal Bitcoin Chart Setups - What is Bitcoin Reversal Patterns?

Alternatively, the head and shoulders pattern can also develop with a descending neckline, as exemplified by the cryptocurrency image shown underneath:

Recognizing the Sloping Head and Shoulders Pattern in Bitcoin Charts - Identifying Reversal Chart Setups

Example of Head and Shoulder Pattern Setup on Chart

Head and Shoulders Pattern on Bitcoin Chart - Bitcoin Reversal Patterns Basics

Head and Shoulders Chart Pattern

This crypto pattern can form on a slanted neckline too. The neckline does not need to be flat.

Reverse Head and Shoulders BTCUSD Setup

This is a head and shoulders reversal pattern that forms after a long Bitcoin downtrend. It looks like an upside-down head and shoulders.

This Bitcoin setup is finished once price breaks above the neckline, which you draw by connecting the two peaks between the reversed shoulders.

To go long buyers place their buy stop bitcoin orders just above the neck line.

Summary:

  • This Bitcoin pattern forms after an extended move downwards
  • This setup shows that there will be a reversal in btcusd cryptocurrency trading market
  • This formation looks like up-side-down, thus the name Reverse.
  • We buy when bitcoin price breaks out above the neck-line: see the chart below for explanation.

Inverse Head and Shoulders for Bitcoin: Reversal Trades

Example of Reverse Head Shoulder Pattern on a Bitcoin Chart

Reverse Head & Shoulders Bitcoin Chart Setup – What Do Bitcoin Reversal Patterns Look Like?

Example of Reverse Head Shoulders Pattern

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