Bitcoin (CRYPTO: BTC) and ether (CRYPTO: ETH) have all leveled off in bullish flag patterns on the daily chart. The bull flag pattern is created with a sharp upward surge that forms the pole, followed by a consolidation pattern that brings the stock or cryptocurrency down between a channel with parallel lines or when the cryptocurrency trades sideways into a narrowing area that forms one Triangle.
- For bearish traders, the “trend is your friend” applies (until it is not) and the crypto can continue downwards or sideways for a short time within the following pattern. Bears may want to get into trading if the cryptocurrency breaks the bottom of the consolidation pattern. Aggressive traders can choose to buy the stock short on the upper trendline and exit the trade on the lower trendline.
- Bullish traders should look for a break up from the upper descending trendline of the flag formation in order to gain entry into high volume. When a stock or crypto breaks out of a bull flag pattern, the upward movement measured is the length of the rod and should be added to the lowest price inside the flag.
A bull flag is negated when a stock or cryptocurrency closes a trading day below the bottom trendline of the flag pattern or when the flag falls more than 50% of the length of the pole.
See also: Crypto analyst Michaël van de Poppe says Bitcoin will hit that six-digit price after blowing over $ 63,000
The Bitcoin Chart: Bitcoin has a bull flag on the daily newspaper, with the pole being created between October 4th and October 6th and the flag being created between Thursday and Saturday.
The Ethereum Chart: Ethereum has a bull flag, with the poles being created between October 1st and October 7th and the flag being created between Thursday and Saturday.
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