Four Common Bearish Patterns Every Bitcoin Trader Should Know

Candlestick patterns can be bearish and bullish – and they are one of the most popular methods for analyzing price action by cryptocurrency traders. The truth is, there are so many patterns worth learning and understanding. Below, we are listing four common bearish patterns to let you know how they can predict a trend and identify potential patterns.

Bearish Harami

This is the first one in our list and a two candle pattern which signals a likely reversal in price. In this pattern, the first candle is large and green while the second one is a red one with a smaller body. In order to be valid, the second candle must be completely within the range of the body of the first candle. A situation like the bearish Harami has occurred many times in the cryptonews.

Dark Cloud Cover

Second on our list of four common bearish patterns is the Dark Cloud Cover – another two candle pattern which signals a likely bearish reversal at the top of a bullish movement. The first candle is large and always green, followed by a similar red candle. However, what’s important is that the second candle opens with a gap and closes more than halfway into the body of the first day’s candle.

The Evening Star

If you have studied the four common bearish patterns, you probably know The Evening Star – a bearish reversal pattern which appears on top of an uptrend with a large bullish candle and is followed by a gap to a small bodied candle and one to a red candle closing below the midpoint of the first day.

Shooting Star

Last but not the least is the Shooting Star, a bearish reversal pattern which is common in the Bitcoin news updates. Formed by two candles, it appears during an uptrend and signals that an upcoming reversal to a bearish bias is close. The first candle is green and is followed by a green or red candle with a long upper wick and a small body. It is the long wick which is the indication that bulls control much of the session, before losing their ground to bears.

We hope that these four common bearish patterns will let you identify future bear markets!