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 charts:

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

Consolidation BTCUSD Patterns

Symmetrical triangles are cryptocurrency chart patterns with converging bitcoin trendlines which form a consolidation period. The technical buy point from a symmetrical triangle is the upward 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 plotted by connecting the lows and highs of the trading 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 liable to fail, & therefore less reliable. After a bitcoin price break out the apex forms support & resistance zones for the bitcoin price. Bitcoin Price that has already broken out of the consolidation chart pattern shouldn't retrace past the apex level. The apex level is used as a stop loss setting area for the open Bitcoin trades.

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

These consolidation chart 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 Pattern

However, this trading chart pattern can not go on forever & just like in a tug of war one side will eventually win, looking at the cryptocurrency chart below see how the consolidation eventually had a breakout & moved in one direction. Now how do we ensure that we are on the winning side?

Break out Downward Sell Bitcoin Signal after a Consolidation Pattern

Breakout Upwards Buy Bitcoin Signal after a Consolidation Pattern

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

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

Alternatively if you do not want to wait out the consolidation chart pattern, you can use pending cryptocurrency orders. If you-wouldyou'd want to learn more about pending orders navigate to the lesson: 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 open 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 open buy above the btcusd trading market or to open sell below the btcusd trading market.

Rectangle BTCUSD Pattern

A rectangle consolidation trading chart pattern is a trading range with a thin bitcoin price action which forms a consolidation phase in btcusd market. The price 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 occurs over an extended period of time, giving the chart pattern its rectangle shape.

A break out of bitcoin price action from this consolidation chart 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.