Neutral diamond pattern trade on bitcoin - micro
Updated
Bitcoin has a diamond pattern at play. This pattern is, more often than not, used as a reversal pattern. However, the chances for this pattern is relatively low compared to a lot of other traditional patterns such as the head and shoulders. Due to the long consolidation period, we have opened up a significant amount of shorts in the market and could potentially push for a bullish breakout on this pattern.
The proper way to trade a diamond is to always wait for a confirmation from the price breaking new lows / highs from the 2nd peak after the top/bottom of the patterns. My personal take profit zones would be on the respected trend & pattern's fibonnaci levels. Entering into a trade before the confirmation is a bad use-case of risk management and should never be done during such a split market.
The diamond pattern is a pattern I only trade using Spot or 1x leverage. Due to high risk factor of this pattern, it is extremely important to stay away from high leverage during this trade.
The proper way to trade a diamond is to always wait for a confirmation from the price breaking new lows / highs from the 2nd peak after the top/bottom of the patterns. My personal take profit zones would be on the respected trend & pattern's fibonnaci levels. Entering into a trade before the confirmation is a bad use-case of risk management and should never be done during such a split market.
The diamond pattern is a pattern I only trade using Spot or 1x leverage. Due to high risk factor of this pattern, it is extremely important to stay away from high leverage during this trade.
Note
Diamond pattern has been invalidated. This is why I emphasized in using very low leverage (if any at all) during these diamonds. On legacy markets the diamond pattern is a lot more stable than when trading on bitcoin. However, since bitcoin whales like to trade against TA, I have come to never use leverage. I used 1x leverage, which means that I simply exited the market into "USD". Now that the pattern has been completely rejected for it's bearish movement I am a lot more inclined to believe that this will continue going up.With that being said, I have re-entered the market and simply eaten the -1.5% loss in BTC equity.
Until another bearish pattern shows, I am bullish for another push up.
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