Rounding Bottom Pattern: How to Use It for Crypto Trading

In the crypto space, buying the dip is often recommended when you’re especially bullish on a specific coin or token. This often involves the deployment of funds and capital to accumulate the preferred cryptocurrency following a substantial dip in its price. While this can be tough because crypto traders can never fully time the market or denote when there’ll be a market reversal, they can significantly improve their odds with the help of technical analysis and recognizing chart patterns. That’s where bullish reversal patterns such as the rounding bottom come into play. 

By recognizing the formation of an upcoming “U” shaped bottom, traders with knowledge of technical analysis can secure an upper hand and establish a position before the charting pattern fully plays out. 

Keen to find out how to profit from the upward trend reversal? In this guide, we’ll look at how crypto traders can use the rounding bottom chart pattern to their advantage in trading.

Key Takeaways:

• A rounding bottom pattern is a technical analysis trading strategy used to identify potential reversal points in an asset’s price. 
• A rounding bottom pattern is identified by the gradual decrease of an asset’s price, followed by an abrupt shift that completes the rounding motion and marks the formation of a recognizable “U” shaped bottom.