What are the key characteristics of a bullish cypher pattern in the context of digital currencies?

1 answers

• Samuel ReginaldoDec 15, 2022 · 3 years ago
  In the context of digital currencies, a bullish cypher pattern is a technical analysis pattern that suggests a potential upward trend. It is formed by a specific price structure and Fibonacci ratios. The pattern consists of four points: X, A, B, and C. The XA leg represents the initial move of the trend, the AB leg is a retracement of the XA leg, and the BC leg is an extension of the AB leg. The CD leg is the final move of the pattern and should be approximately equal to the AB leg in terms of price. To identify a bullish cypher pattern, traders look for specific Fibonacci ratios between the XA and BC legs, such as 0.382 and 0.618. Additionally, the BC leg should retrace between 0.382 and 0.886 of the AB leg. When these characteristics are present, it suggests a potential bullish reversal in digital currencies.
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