Veteran crypto analyst Peter Brandt has spotted a peculiar pattern in Bitcoin’s price chart – an inverted triangle. He’s using his classic charting skills to figure out what this means for Bitcoin’s future.
What’s the Triangle All About?
Brandt noticed this triangle pattern in Bitcoin’s price chart from May 2023 to November 2024. Triangles in charts can signal either a continuation of the current trend or a complete reversal. In this case, the triangle has two lines sloping downwards and moving further apart.
While this might seem like a bullish signal, Brandt isn’t jumping into any trades just yet. He’s waiting for a breakout – a clear signal that the price is moving in a specific direction. He sticks to established chart patterns and avoids trading when the price is stuck in a range without a clear trend.
A Debate on Names
Another crypto enthusiast suggested the pattern might be a “descending broadening wedge.” Brandt prefers to use the terminology established by the founders of classical charting – Schabacker, Magee, and Edwards.
Risk Management is Key
The crypto community agreed with Brandt that Bitcoin has been stuck in a holding pattern for over a year, making it a risky time to trade. Brandt emphasized that he prioritizes risk management and avoids going against his established trading strategies.
Classic Charting: Not Always Perfect
Brandt also explained that classical chart patterns can be tricky. He says that about 50% of the time, these patterns morph into something unexpected. Another 25% of the time, they break out in the anticipated direction but then fail to sustain the movement, leading to a reversal. Only in the remaining 25% of cases do the patterns break out as predicted and move towards the projected target.
So, while the inverted triangle in Bitcoin’s chart is interesting, it’s not a clear signal for traders to jump in just yet. Brandt is sticking to his classic charting principles and waiting for a clear breakout before making any moves.
