Bitcoin (BTC) is trading around $ 7052. It seems to be forming an inverted head and shoulders pattern. If indeed, it breaks out of this pattern, it will gain an upside of approximately $ 250. We figure out whether it can take out from the inverted head and shoulders pattern in this Bitcoin (BTC) technical price analysis September 1, 2018.
Bitcoin (BTC) technical price analysis September 1, 2018:
The inverted head formation is at a level of $ 6805. The right shoulder is at a level of $ 6898. The left shoulder is at a level of $ 6938. The neckline will break around $ 7091. If you’re a conservative trader and want to reduce the risk of a false breakout, you can wait for $ 7120 to breakout as well. If indeed, it is able to take these levels out as well, there will be an upside of $ 250. The stoploss can be set just below the neckline around $ 7030. Thus, with the stoploss of $ 90, you can gain outside of over $ 250. The risk-reward ratio will be entirely in your favor.
The inverted head and shoulders pattern is a bullish pattern. Once the neckline breaks, it can rise higher. The quantum is equal to the difference between the head and the neckline. In this case, the difference between both these levels is around $ 293. However, we have worked with a conservative target of $ 250. You need to ensure that it is a proper breakout and it is able to sustain above $ 7120 levels on a consistent basis before initiating the trade.
As always, it is a good idea to look at the additional confirmation indicators as well. The confirmation indicator can be MACD or it can be volume breakout or it can be RSI. When you use the confirmation indicators as well, it will become much easier for you to avoid a false breakout. Once you are able to avoid the false breakout, you will be able to more easily initiate the trade.
The level of $ 7120 is also recent top which Bitcoin (BTC) formed recently. That is why it is pretty important. These levels are also being monitored by many traders to find out whether btc is breaking out or whether it will form a triple top and move downwards.
In order to conduct this Bitcoin (BTC) technical price analysis September 1, 2018, we used the five-day chart with each candle representing 5 minutes. Thus, if you want to cross verify you can use the same chart in order to check out the pattern. We have also included an image of the chart above.