Bilateral/Consolidation Cryptocurrency Chart Patterns Bitcoin Trading

With bilateral/consolidation bitcoin trading patterns the btcusd trading market can move in any direction. There are two different types of consolidation cryptocurrency chart patterns that form on crypto charts:

• Symmetric Triangles - Consolidation bitcoin trading chart patterns
• Rectangles - Range/ranging market

Consolidation BTCUSD Trading Patterns

Symmetrical triangles are cryptocurrency chart patterns with converging bitcoin trend lines that form a consolidation period. The technical buy point from a symmetrical triangle is the upside break, while a downside break is a technical sell crypto signal. Ideally, a market breaks out from a symmetrical triangle prior to reaching apex of the triangle.

Bitcoin Trendlines can be drawn connecting the lows and highs of the consolidation phase, the bitcoin trend lines formed are symmetric and converge to form an apex. A breakout should occur somewhere between 60-80% into the triangle cryptocurrency chart pattern. An early or late breakout is more prone to failure, and therefore less reliable. After a bitcoin price breakout the apex forms support and resistance levels for the bitcoin price. Bitcoin Price that has broken out of the apex should not retrace past the apex. The apex is used as a stop loss setting area for the open Bitcoin trades.

When these consolidation patterns form we say that the btcusd market is taking a pause before deciding which is the next direction to take.

These consolidation patterns form when there is a tug of war between the buyers and the sellers and the btcusd market can't decide which way to continue.

Consolidation Bitcoin Chart Pattern

However, this pattern cannot go on forever and just like in a tug of war one side eventually wins, looking at the cryptocurrency chart below see how the consolidation eventually had a breakout and moved in one direction. Now how do we make sure that we are on the winning side?

Break out Downward Sell Bitcoin Signal after a Consolidation

Breakout Upwards Buy Bitcoin Signal after a Consolidation

Now back to our question, how do we make sure we are on side that's winning?

Well we wait until bitcoin price moves past one of the lines and put buy or sell orders in that direction. After consolidating, If bitcoin price breaks-out the upper line we buy, if it breaks-out the lower line we sell.

Alternatively if you do not want to wait out the consolidation, you can use pending cryptocurrency orders. If you would like to know more about pending crypto orders go to the topic: Stop Entry Bitcoin Order Types

The two types of stop order types used to trade consolidation bitcoin trading patterns are:

• Buy Entry Stop An order to buy at a level above btcusd trading market bitcoin price.

• Sell Entry Stop An order to sell at a level below btcusd trading market bitcoin price.

These are cryptocurrency orders to buy above the btcusd trading market or to sell below the btcusd trading market.

Rectangle BTCUSD Trading Pattern

A rectangle consolidation pattern is a trading range with narrow bitcoin price action which forms a consolidation phase in btcusd market. The trading range is defined by two parallel bitcoin trend lines which are horizontal and indicate the presence of support & resistance. This bitcoin pattern is drawn on a cryptocurrency chart using a rectangle, hence the name rectangle bitcoin trading chart pattern.

For this consolidation cryptocurrency chart pattern, bitcoin price forms multiple highs and lows that can be connected with horizontal bitcoin trend lines that are parallel to each other. This bitcoin pattern forms over an extended period of time giving the pattern its rectangle shape.

A breakout of bitcoin price action from this consolidation pattern occurs when either of the horizontal line is penetrated & the trading range of this rectangle is broken. An upside breakout is a buy crypto signal. A downside breakout is a sell bitcoin signal.

Rectangle Pattern Cryptocurrency - Consolidation Pattern

Bitcoin Price Breaks the consolidation range after sometime & continues to move upwards after an upward market breakout.