U.Today - Veteran Trader Peter Brandt has recently highlighted an intriguing price pattern emerging for Bitcoin (BTC). In a recent tweet, Brandt shared his perspective on charting and pointed out that Bitcoin’s price action was displaying an inverted, or expanding, triangle pattern.
Brandt revealed his disciplined approach to trading, saying, "I do not trade opinions. I trade set-ups via classical charting principles. I avoid trades when price is range bound. My entry is on completed patterns."
"BTC displays what is known as an inverted or expanding triangle," Brandt added.
A triangle is a chart pattern depicted by trendlines along a converging price range, indicating a pause in the prevailing trend. Technical analysts categorize triangles as continuation patterns of an existing trend or a reversal.
Bitcoin (BTC), the largest cryptocurrency by market capitalization, experienced a sell-off during Sunday's trading session. The selling continued, with Bitcoin touching an intraday low of $57,663 on Monday.
At the time of writing, BTC had dropped 2.09% in the previous 24 hours to $59,450, down from a high of $62,755 on Thursday.
Here's the warning part
While the expanding triangle pattern on Bitcoin’s chart is noteworthy, Brandt issued a warning: "No breakout yet so no trade."Despite the triangle pattern being a continuation pattern, traders are often urged to look for breakouts before they make a move to enter or exit a position.
This is because, in technical analysis, a breakout from a pattern often signifies the start of a new trend, but until that breakout occurs, the direction of the move remains speculative.
The expanding triangle pattern suggests that Bitcoin might be gearing up for a potentially significant move, but without a confirmed breakout, the direction of that move remains unknown.
The caution from Peter Brandt highlights the importance of patience and not making hasty decisions but rather waiting for confirmation before entering a trade.