Well known cryptocurrency enthusiast, @redxbt, recently noted the creation of a triple bottom pattern for BTC.
Additionally, he noted that triple bottoms are rarely successful in BTC and provided two examples, one of a successful and one of an unsuccessful creation of a triple bottom.
Bitcoin never triple bottoms but I’m glad to be proven wrong by the almighty 2019 bulls 🙂 pic.twitter.com/clCS6u6weo
— red (@redxbt) September 5, 2019
The triple bottom is a bullish pattern and often signifies that an uptrend will soon be initiated.
However, the pattern should not be taken as a guaranteed price increase or looked at without regard to prior price movement or resistance lines.
One scenario that may have contributed to the bearish sentiment of @redxbt is the descending resistance line that has been in place alongside the triple bottom:
The descending resistance line creates a descending triangle, which is considered a bearish pattern.
This illustrates the significance of taking into account resistance lines when observing a triple bottom.
A descending resistance line can increase the possibility of a failed triple bottom.
Another example which demonstrates this statement is given below.
In 2017, BTC created a head and shoulders, which is considered a bearish pattern.
If we not had paid attention to the price highs, we could have misread this as a triple bottom and had a bullish outlook instead.
However, the contrary proved to be true, since BTC broke down shortly afterward.
Bitcoin has recently made a triple bottom inside a bearish descending triangle.
According to @redxbt, BTC will eventually break down from this pattern.
Do you think BTC will make a triple bottom or will it break down below support? Let us know in the comments below.
Disclaimer: This article is not trading advice and should not be construed as such. It is for educational purposes only and represents the typical trades the author would make himself. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
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