As a seasoned researcher and crypto enthusiast with years of experience under my belt, I find the analysis presented by Peter Brandt intriguing. His use of classical charting principles to decipher Bitcoin’s recent price movements is a testament to his deep understanding of the market dynamics.
Experienced cryptocurrency expert, Peter Brandt, has identified a reversal or broadening wedge shape in Bitcoin (BTC) based on his study of traditional charting methods. By examining the formation of this technical pattern, Brandt provides insights into how it might influence Bitcoin’s future price movement.
What Bitcoin’s Inverted Triangle Pattern Means
On August 12th, I hopped on my preferred platform (previously known as Twitter) to discuss an intriguing trend I noticed in Bitcoin’s price chart. I presented a graph depicting Bitcoin’s price fluctuations from May 2023 up until November 2024, during which I identified an unusual, inverted or expanding Triangle formation. As an analyst, this pattern caught my eye and might offer insights into Bitcoin’s future price movements.
Typically, patterns resembling triangles on a Bitcoin’s price chart may signal either an ongoing trend or a change in direction for Bitcoin’s price fluctuations. The diagram shared by Brandt displays two downward sloping trendlines that are gradually moving apart.
Brandt clarifies that although this pattern might seem like a positive indication, since there’s no breakout happening, he won’t be placing any trades right now. He underlined the fact that his trading decisions are not influenced by personal views, but rather by proven chart patterns.
The crypto expert also pointed out that he tends to abstain from trading when the price moves within a set range without a discernible trend. Instead, he prefers to engage in trades once a recognizable pattern has been formed.
After Brandt identified Bitcoin’s chart pattern as an inverted or expanding triangle, a member of the crypto community suggested it might be more accurate to call it a “widening descending wedge.” Brandt explained that while there are many terms for patterns, he personally prefers to stick with the terminology developed by Schabacker, Magee, and Edwards, who are recognized as pioneers in traditional charting.
In agreement with Brandt’s perspective that we haven’t seen a significant surge (breakout) yet, making it unsuitable for trading, a member of the crypto community pointed out that Bitcoin has been in a holding pattern for more than a year. This observation raises the possibility that it might not be an optimal time to make trades. Brandt concurred but highlighted his focus on risk management and his preference for sticking to his well-established trading strategies rather than acting against them.
A final crypto member suggested that the inverted or expanding triangle pattern in Bitcoin may be a “bullish megaphone or bull flag.” Brandt responded by clarifying that, while some might label the pattern as a bull flag, it does not align with the definitions set by the founders of classical charting.
Insights On Brandt’s Classical Charting Principles
Recently, I’ve delved deep into the efficacy of employing traditional chart patterns for trading, as outlined by Brandt in his latest post. Interestingly, when these classic chart patterns are detected, they tend to unfold in one of three clear resolutions.
Brandt pointed out that around half of these patterns will transform into something unforeseen, not adhering to the original forecasts. He also mentioned that a quarter of these classical chart patterns initially breakout in the expected direction but then fail to maintain momentum, resulting in a reversal or loss. Lastly, he noted that about a fourth of the time, the patterns proceed as predicted and move towards the projected goal, realizing the anticipated outcome.
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2024-08-13 23:10