{"id":400535,"date":"2019-10-04T18:00:23","date_gmt":"2019-10-04T18:00:23","guid":{"rendered":"https:\/\/ktsl888.com\/?p=400535"},"modified":"2019-10-04T17:58:45","modified_gmt":"2019-10-04T17:58:45","slug":"three-black-crows-bitcoin-monthly-chart-forms-ominous-reversal-pattern","status":"publish","type":"post","link":"https:\/\/ktsl888.com\/news\/three-black-crows-bitcoin-monthly-chart-forms-ominous-reversal-pattern\/","title":{"rendered":"Three Black Crows: Bitcoin Monthly Chart Forms Ominous Reversal Pattern"},"content":{"rendered":"
Just days ago Bitcoin<\/a> closed its monthly candle for September, marking three red candles in a row for the first time in 2019.\u00a0<\/span><\/p>\n While this in itself may not seem significant. The three red candle closes have formed what could be a powerful Japanese candlestick pattern that signals a major trend reversal and a much deeper drop ahead. And if past occurrences of the pattern are anything to go by, the crypto market may be in for an extended crypto winter and possibly a return to the depths of the bear market.<\/span><\/p>\n Throughout 2019, Bitcoin<\/a> has been on an upward trajectory, and at its peak brought investors who bought the bottom of its bear market as much as 350% returns. But starting at the end of June, Bitcoin\u2019s bullish momentum began to fade, and the asset began trading within an increasingly narrowing trading range.<\/span><\/p>\n July closed the first monthly red candle of the year, setting Bitcoin\u2019s first lower high. Another rally in August resulted in yet another lower high, and yet another red monthly candle close. At this point, it was clear Bitcoin was trading in a triangle pattern, however, analysts were torn as to which direction the formation may break out.<\/span><\/p>\n Related Reading | Bitcoin Price Breaks Below $8,000 Just Days After Triangle Breakdown\u00a0<\/a><\/strong><\/em><\/p>\n Hope that Bakkt<\/a> would fuel Bitcoin\u2019s rocket to the moon kept bulls fighting, but once the platform launched on September 23, 2019, to abysmal trading volume and interest<\/a>, bears took control and pushed Bitcoin\u2019s price from $10,000 to under $8,000\u2013\u2013an over 20% drop\u2013\u2013in less than 48 hours.<\/span><\/p>\n The market fearing that Bitcoin\u2019s bull run may be in jeopardy sparked a sudden increase in sell pressure that kept September\u2019s monthly candle close in the red yet again, marking the third consecutive candle close in a row.<\/span><\/p>\n <\/p>\n Worse yet, the third close in a row may have caused Bitcoin price charts to form an ominous reversal pattern, and one that could result in a powerful downtrend in the weeks and months ahead.<\/span><\/p>\n The third consecutive monthly close may have formed a powerful Japanese candlestick pattern ominously dubbed three black crows<\/i>.<\/span><\/p>\n Wikipedia<\/a><\/span> defines three black crows as a candlestick pattern that \u201cindicates a strong price reversal from a bull market to a bear market.\u201d It is most commonly\u2013\u2013but not always\u2013\u2013 found at the top of an uptrend, and signals a powerful reversal.<\/span><\/p>\n Related Reading | Crypto Analyst: Altcoin Apocalypse Caused Bitcoin Bear Market\u00a0<\/a><\/strong><\/em><\/p>\n Leading up to and during the pattern, volume diminishes, and on the third candle, it will close on relatively high volume according to an Investopedia entry<\/span><\/a> on the subject.<\/span><\/p>\n Like many chart or candlestick patterns, a confirmation is required for the formation to be valid, and can only be confirmed in hindsight. A confirmation of the three black crows formation would be a steep downtrend from here. However, when trading the pattern, investors are advised to watch for oversold conditions before a further fall, due to three consecutive bearish months exhausting some of the sell pressure.<\/span><\/p>\n <\/p>\n The pattern is far more likely to confirm if the pattern appears on price charts of financial assets that coincide with other indicators flipping bearish. Further adding credence to the theory that this extremely bearish and powerful price pattern may have formed on Bitcoin<\/a> price charts, is a confirmation of three separate indicators: the MACD, Stochastic RSI, and an indicator called the Fisher Transform.<\/span><\/p>\n Each of the three indicators has all turned bearish on monthly timeframes, suggesting that the trend is changing in a major way.<\/span><\/p>\n All things considered, the trend ahead is not looking positive for Bitcoin<\/a>. But how bad can things get? Most are certain that Bitcoin has bottomed and is building support for its next bull run, but considering the last couple of times Bitcoin price closed three consecutive red monthly candles in a row, extreme crashes followed.<\/span><\/p>\nBitcoin Price Closes Third Consecutive Monthly Red Candle<\/span><\/h2>\n
Three Black Crows: Does This Reversal Pattern Signal a Return to Crypto Winter?<\/span><\/h2>\n
Ominous Reversal May Signal Dangerous 50% drop and Second Leg of Bear Market<\/span><\/h2>\n