Cup & Handle and Head & Shoulders Patterns in Crypto Trading

Crypto traders rely on chart patterns for timing and risk management. This guide covers two major patterns: the bullish cup and handle and the bearish head and shoulders. The cup and handle pattern forms a rounded U-shaped cup, followed by a consolidation handle. Traders watch for a breakout above the handle’s resistance with rising volume to confirm strength. Key cup and handle criteria include symmetry, handle depth, and volume trends. The head and shoulders pattern signals a trend reversal. It features three peaks: left shoulder, head, and right shoulder connected by a neckline. A drop below the neckline on increased volume confirms the bearish reversal. Traders use the neckline as support-turned-resistance and set stops accordingly. Volume confirmation is crucial in both the cup and handle and head and shoulders patterns. Mastering these two chart patterns can sharpen entry timing and improve risk management in crypto trading.