How to identify a reversal forms in carbons price of cryptocurrencies
The world of cryptocurrencies was marked by the rapid fluctuations and volatility of the price. As a result, traders and investors are becoming more dependent on the tools for technical analysis to make informed decisions on the purchase and sale of property. Among the various indicators and standards that can be used to predict the turnaround is to identify twist forms in pricing charts.
What are the turns of the turnaround?
A twist pattern is a specific combination of prices and price levels indicating a potential turning point or a reversal in a market trend. In other words, this is a sign that a high or current trend can end, and a new trend will start soon.
Types of turnarcuts
There are several types of reversals that can be identified in carbonate prices of cryptocurrencies, including:
- head and shoulder standard (H&S) : a classic reversal pattern that characterizes three peaks and a gutter.
- Standard head and reverse shoulders (HIS) : similar to H&S, but with reverse relationships between peaks and levels.
- Upper/lower double standard : two low consecutive maximums or two consecutive lowest.
- Bush Standard : A reversal pattern characterized by a small price movement, followed by a large movement in the opposite direction.
How to identify a turnarp forms
To recognize the reversal patterns, traders use different tools and techniques of technical analysis, including:
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Identification of a turnaround forms
Here are some tips on identifying a reversal forms in the cards of the price of cryptocurrencies:
- Pay attention to changes in trends : Note when the trend is reverse, usually accompanied by a change in feelings in the market.
- Search for consolidation periods
: Identify areas where prices are consolidated or reversed before continuing your previous trend.
- MONITOR DANTOR indicators : Use tools such as RSI (relative strength index), Bollinger belts and stock oscillator to identify possible reversals.
- Follow the key levels : Follow the price action at significant levels of support and resistance.
Example of a reversal forms in carbonate prices of cryptocurrencies
Let’s see the example of Bitcoin Price Price (BTC) from 2016 to 2021, highlighting several reversal standards:
| Time period | Trend | Support/resistance |
| — | — | — |
| 2016-2017 | Up trend | 16.00- $ 19.50 |
| 2018-2019 | Trend Down | $ 3.50 to $ 4.20 |
| 2020-2021 | Up trend | $ 33,000 to $ 35,000 |
In this example, we can see that the price of bitcoin has increased to a resistance level from 16.00 to 19.50 USD (2016-2017), indicating a standard reversal potential. Later, in 2018-2019, the price dropped to a level of support from $ 3.50 to $ 4.20, which suggests a new trend.
Conclusion
The identification of the reversal forms is crucial for a successful trade and investment in the CRIPTO currency markets. Paying attention to graphic indicators, time analysis and -have levels, traders can recognize possible turns before reprimanding. Remember to monitor the trends, consolidation periods and support/resistance levels to make informed decisions to buy and sell property.