Btc appears to be forming a bullish pennant on the daily. Pennants are usually continuation patterns & very rarely produce a trend reversal. The move before the pennant formation is in an uptrend, so btc is likely to continue its move upwards if it breaks up above when we reach the apex of the triangle (we're nearly there/possibly already there).
Another key point is the volume. Volume should dry up during the formation of a pennant, which is what has been happening thus far. This adds further confirmation that this is very likely a bullish pennant. However a close below $9,300 at this point would invalidate this idea.
A pennant that has lasted 3 months? Are you sure about that? That is very rare. Pennants normally last from 1-4 weeks (generally a maximum of 12-13 weeks) and are a continuation of a trend in conjunction with other indicators that signal the overall trend direction.
Here's my analysis on what I believe is a triangle formation.
kelvinn90
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@PurpleCrypto, a pennant can exist in any timeframe, even a longer one. If the build up takes longer, then it only means there will be a bigger move up.
The key here is to look at the trend before the pennant, if the trend is up, then this pennant is a continuation pattern before it starts to resume its uptrend again.
Pennants very rarely act as reversals.
PurpleCrypto
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@kelvinn90, Time frames and durations are two completely different things. Time frames generally refer to the time frames on a chart (days, weeks, months). Duration is how long the trend/triangle/pennant lasts for.
If it is duration that you are referring to, then do you mind sharing where you got the information that pennants can last for any length of time?
It is well-noted that anything longer than 8 weeks is pushing the limit for a reliable flag/pennant pattern.
kelvinn90
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@PurpleCrypto, yes sorry, i meant the duration. I didnt really consider the duration when i charted that pattern. Yup, might be invalidated by the duration but its showing a very clear pennant. Only downside to it is the duration of course.
Here's my analysis on what I believe is a triangle formation.