Technical Analysis of Head and Shoulders Bitcoin Chart Patterns

How to Interpret Head and Shoulders Bitcoin Chart Patterns

Head & Shoulders BTCUSD Trading Pattern

Head and Shoulders Bitcoin Pattern is a reversal bitcoin trading pattern which forms after an extended Bitcoin Trading upwards trend.

Head & Shoulders Bitcoin Pattern is made up of 3 consecutive peaks, the left shoulder, the head & the right shoulder with 2 moderate troughs between the 2 shoulders.

This Head & Shoulders Bitcoin Pattern is considered complete once bitcoin trading price penetrates and moves below the neck line, which is drawn by joining the two troughs in between the shoulders chart pattern.

To open a sell bitcoin trade after this reversal bitcoin trading signal, Bitcoin traders place their sell stop bitcoin orders just below the neck line.

Summary:

• This Head & Shoulders Bitcoin Pattern forms after an extended move upwards - bitcoin upwards trend
• This Head & Shoulders Bitcoin Pattern formation indicates that there will be a reversal in btcusd trading market
• This Head & Shoulders Bitcoin Pattern formation resembles a head with shoulders thus its name.
• To draw the neckline we use chart point 1 & point 2 as shown on the cryptocurrency trading example illustrated below. We also extend this line in both directions.
• We sell when bitcoin price breaks-out below neckline: as explained on the cryptocurrency trading example illustrated below.

Analysis of Head and Shoulders Crypto Chart Patterns?

Or the head and shoulders cryptocurrency pattern can also form on a slanting neck line, like the cryptocurrency trading example illustrated below:

Analysis of Head and Shoulders Crypto Chart Patterns?

Example of Head & Shoulders Bitcoin Pattern on a Bitcoin Chart

How to Trade the Head and Shoulders Crypto Chart Pattern

This Head & Shoulders Bitcoin Pattern can also be formed on a slanting neck line, like the head & shoulders cryptocurrency pattern example above, the neck-line doesn't have to be necessarily horizontal.