If you are a beginner, you should know about bullish and bearish trends, this will help you not only in Trading but also Investing in Crypto.
This is a fundamental concept for trading oand investing. If you understand this, your all set with the first Step in becoming Profitable . This is essential for understanding the market, as Charts never lie.
šØBearish Continuation Patterns
These patterns indicate that a downtrend is likely to continue after a consolidation phase. Here are the key bearish patterns:
ā 1. Bearish Flag: A downward trend followed by a rectangular consolidation and a breakout to the downside.
ā 2. Bearish Pennant: A smaller triangular consolidation after a sharp downtrend, usually followed by a further drop.
ā 3. Bearish Rising Wedge: A narrowing upward price channel that breaks downward.
ā 4. Descending Triangle: A horizontal support level and descending resistance lead to a breakdown.
ā 5. Inverted Cup and Handle: A rounded top followed by a smaller consolidation before a drop.
āStrategy for Bearish Patterns:
Short Entry: After the breakdown from the consolidation phase.
Stop Loss: Just above the resistance trendline or previous swing high.
Take Profit: Measure the height of the previous trend and project downward.
šBullish Continuation Patterns
These patterns suggest that an uptrend is set to resume after consolidation. Key bullish patterns include:
ā 1. Bullish Flag: An upward trend followed by a rectangular consolidation and breakout upward.
ā 2. Bullish Pennant: A small symmetrical triangle following a sharp rise, leading to another upward breakout.
ā 3. Bullish Falling Wedge: A narrowing downward price channel breaking upward.
ā 4. Right Angle Descending Wedge: A descending resistance trendline with a flat support level leading to an upward breakout.
ā 5. Symmetrical Triangle: A triangle pattern with converging trendlines, leading to continuation upward.
ā 6. Cup and Handle: A rounded bottom followed by a smaller consolidation and breakout upward.
ā 7. J-Hook Pattern: A smooth upward curve signaling a continuation of the uptrend.
ā 8. Scoop Pattern: A rounded dip in price followed by a sharp rise.
āStrategy for Bullish Patterns:
Long Entry: After the breakout from consolidation.
Stop Loss: Below the support trendline or previous swing low.
Take Profit: Measure the height of the previous trend and project upward.
š°Additional tips, to leverage these patterns effectively:
1. Set Alerts: Use Binance's charting tools to set alerts for potential breakout points.
2. Risk Management: Risk only 1-2% of your portfolio per trade to protect your capital.
3. Practice Scalping: Look for these patterns on shorter timeframes (e.g., 5m, 15m) for quicker trades.
4. Use Leverage Carefully: If using leverage, ensure tight stop losses to minimize risk.
5. Backtest Strategies: Use Binance's demo account or tools like TradingView to test strategies on historical data
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āClick to Read how not to lose money as a beginner on Binance š„
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