Downward Bitcoin Trend Lines and Channels
Downward Bitcoin Trend Line MetaTrader 4 Bitcoin Trend Line Indicator
A downward bitcoin trend line is drawn above the crypto downward bitcoin trend pattern formed by consecutive lower highs, the downward bitcoin trend line must connect at least two highs, with the most recent high being lower. For our crypto downward bitcoin trend examples we shall use the MT4 technical analysis software cryptocurrency charts to illustrate an example of downward cryptocurrency trend.
Since bitcoin price moves down in a zigzag manner bitcoin traders normally draw a downward bitcoin trend line which shows the general downward direction of the bitcoin prices. In cryptocurrency market technical analysis, this general bitcoin price direction is referred to as the TREND by cryptocurrency traders. In cryptocurrency trading technical analysis definition we can define this down bitcoin trend line is drawn on a Bitcoin chart showing the resistance levels (bearish market direction).
A down bitcoin trend occurs when the bitcoin trading price forms a series of lower highs and lower lows. Each price high is going to be lower than the previous high - lower high, and each low is lower than the previous low - lower low therefore showing bearish bitcoin price movement.
BTCUSD Crypto Down trend lines gain more validity each time bitcoin price touches the downward bitcoin trend line but does not penetrate the bitcoin trend line. A down bitcoin trend remains the general direction until this series of lower highs and lower lows is broken.
In cryptocurrency trading technical analysis, An upside penetration of a down bitcoin trend line is a technical buy bitcoin trading signal, and usually the first indication that the bearish direction of bitcoin prices may soon reverse.
Downward Bitcoin Trend Line MetaTrader 4 Bitcoin Trend Lines Indicator
When it comes to learning how to draw and learning cryptocurrency trading technical analysis of cryptocurrency charts, you need to know that when the btcusd trading market is bearish it forms lower lows and lower highs forming a downward general market direction. These are the points that are used to draw the downward bitcoin trend line.
To draw this crypto downward bitcoin trend setup we use resistances and to do it correctly two resistances are needed. When bitcoin price touches this bitcoin trend line, then we sell and place stop loss just a few pips above the sloping resistances:
Trading This Downward Bitcoin Trend Market Move
When trading with this bitcoin trend line trading method, this bitcoin trend line setup will show the general direction of the btcusd trading market as downwards therefore bitcoin traders will only open short sell cryptocurrency trades. These are the levels where if bitcoin price retraces then these points will provide strong resistance. This is why many short sellers will wait until bitcoin price retraces upwards and hits these retracements levels to open sell cryptocurrency trades. Bitcoin trades opened at these levels have a high Risk to Reward Ratio with minimum draw down.
For Example, in the above bitcoin trading example, a bitcoin trader would have opened short sell bitcoin trading signals at the resistance1, resistance2, resistance3 and these sell cryptocurrency trades would have made a lot of profits with minimum amount of draw-down/retracement.
Downward Bitcoin Channel MetaTrader 4 Channel Indicator
A crypto downward channel is drawn by drawing a line that is parallel to the downward bitcoin trend line and then adjusting it to touch the bottom boundary of the bitcoin price movement. This then forms a downward crypto channel and as long as the bitcoin price stays between these two channels the general cryptocurrency market direction is intact the btcusd trading market direction will continue being bearish.
Trading the Downward Cryptocurrency Channel
The downward crypto channel is used by cryptocurrency traders to show levels where it is best to take profits. Traders will take some profit once the bitcoin price touches the lower channel and wait for another retracement before opening a short sell bitcoin trade again.
MT4 Tools for Drawing Bitcoin Channels
The bitcoin trading tools to draw these crypto channels studies on the MetaTrader 4 bitcoin charts are found on the Lines Toolbar within the MetaTrader 4 platform, to access this MT4 tool bar if it is not activated on your MetaTrader 4 Bitcoin Trading Platform, Click in "View" Next to "File" at the top left corner of the MT4 Bitcoin Trading Platform and click View, Then Click on Tool bars, Then Check the Lines Toolbar by clicking on it.
Below is the screenshot of these MT4 tools: just click on this MT4 channels drawing tool and select the point to where you want to place this crypto channels tool on the bitcoin chart.
MT4 Technical Analysis Charts - Downward Bitcoin Channels
MT4 Toolbar - MetaTrader 4 Tools for Drawing Bitcoin Trend Lines and Bitcoin Channels used to obtain these bitcoin trend line drawing tools is shown above, to draw these bitcoin trend line setups or crypto channels, just select the above MetaTrader 4 bitcoin trend line drawing tools shown on the MetaTrader 4 software and select the two points where you want to draw the crypto downward bitcoin trend line.
This bitcoin trend line bitcoin trading strategy is one of the simplest and popular crypto indicators used by cryptocurrency traders to analyze the btcusd trading market bitcoin trend direction.
