$BTC decision time on a Potential Double Top
Updated
Double top? 66% do not close below confirmation point
From Thomas Bulkowski’s “Encyclopedia of Chart Patterns”:
Guidelines for properly identifying a Double Top:
Upward Price Trend
~10% decline b/w 2 tops
~3% or less b/w tops (1.56% difference)
A month or more b/w tops is preferred (14 days for
BTC)
Volume higher on first top
Price must close below confirmation point
A close below confirmation point = 83% chance of continuing downwards
Average decline from highest peak to lowest low is 32%
Expect Double Tops to perform poorly in Bull Markets
3 Scenarios:
1.BTC closes below CP and continues downward 8000ish. (35% chance)
2.BTC as bottomed out and reverse. (CP as support) (66% chance)
3.BTC closes below CP and reverses upwards. (5% chance)
From Thomas Bulkowski’s “Encyclopedia of Chart Patterns”:
Guidelines for properly identifying a Double Top:
Upward Price Trend
~10% decline b/w 2 tops
~3% or less b/w tops (1.56% difference)
A month or more b/w tops is preferred (14 days for
BTC)Volume higher on first top
Price must close below confirmation point
A close below confirmation point = 83% chance of continuing downwards
Average decline from highest peak to lowest low is 32%
Expect Double Tops to perform poorly in Bull Markets
3 Scenarios:
1.
BTC closes below CP and continues downward 8000ish. (35% chance)2.
BTC as bottomed out and reverse. (CP as support) (66% chance)3.
BTC closes below CP and reverses upwards. (5% chance)Trade active
With the close below CP...it looks like we can see another move downward. Bulkowski states the retrace usually falls to the launch point (which is an area of consolidation). The chart shows me this area is around $8300.
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