"Jack's Trading Classroom: BTCUSD Trend Analysis - Rising Wedge Pattern"

Jack's trading classroom "Analyzing Trends in BTCUSD in Another Pattern - Rising Wedge"

Let's start by briefly introducing a classic pattern that BTCUSD may currently be forming - the rising wedge. A rising wedge refers to a scenario in the candlestick chart where the bearish selling pressure is not significant, but the bullish buying pressure gradually decreases. Once the bullish buying pressure diminishes and the candlestick breaks below the rising support trend line, it is considered the end of the bullish trend.

There is a high probability of a downward correction in the future. Breaking below the rising support trend line below can be considered a correct entry point for short positions, while the bottom starting point of the rally can be seen as a structural support level.

After briefly introducing the basic pattern of the rising wedge, we can still see the four-hour candlestick chart of BTCUSD. On April 8, 2020, we published a technical analysis article titled "BTCUSD Continues to Show Strength with No Reversal in Sight." In that article, we mentioned, "If the bottom low of 7080.0 is breached, it signifies the formation of a double top pattern in the four-hour cycle. You can choose to enter short positions after the support trend line and neckline support are broken, setting the stop-loss above the previous high."

Yesterday's analysis mentioned that the potential double top structure has been invalidated, but attention can still be focused on the bottom low of 7080.0 and the support level of 7190.0. Based on the potential rising wedge pattern in the large cycle, if this range is breached, BTCUSD will show that the bottom support trend line has been broken, indicating the end of the upward buying pressure.

Therefore, you can try to enter short positions based on yesterday's logic, setting the stop-loss at the previous high of 7475.0. As the Bitcoin reward halving in May 2020 approaches, there is a high probability of a rally in BTCUSD due to the fundamental impact of the halving. For profit-taking targets, it is recommended to consider moving the stop-loss to protect profits once the profit-loss ratio reaches 1:1.

Remember that this layout strategy involves entering from the right side. Operation based on the rising wedge pattern should enter upon a trend line breakout to avoid early entry and additional risks.

Resistance levels:
R1 7467.0
R2 8089.0
R3 9419.0

Support levels:
S1 7190.0
S2 6627.5
S3 6436.0
S4 5898.5
S5 5388.5
S6 3832.5

In recent days, the cryptocurrency market has experienced significant volatility. It is recommended for operators to strictly follow risk management protocols and avoid high leverage and contract volume operations to prevent additional losses caused by volatile market conditions. This article reflects personal opinions, please read with caution, as cryptocurrency trading may pose risks to your capital.

WeChat Official Account: Jack's Trading Classroom
Personal website: jackbtc.io

Related Readings

• "Jack's Trading Classroom" BTCUSD Shows Continued Strength
• "Jack's Trading Classroom" BTCUSD Continues to Show Strength with No Reversal in Sight

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