![WhatsApp Image 2021-12-03 at 5.17.16 PM.jpeg](https://cdn.steemitimages.com/DQmUVShizSwu12ra46wSmRZ2hQ6UAgR1Lx6nDaYHtw8Kd47/WhatsApp%20Image%202021-12-03%20at%205.17.16%20PM.jpeg) *Designed by @zeebhutta Using Canva* ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) **

Greeting Everyone,

Welcome to my homework for the 3rd week. First of all, huge shot out to the professor @reminiscence01 for teaching the community about the price action of the crypto market as it will help us to become a better traders and open positions with less prone to loss. I have acquired great knowledge from the professor first course and the second course have been equally effective for me. I will share everything that I have learned by answering this task with sheer details.

![4i88GgaV8qiFU89taP2MgKXzwntUGAvkoQiKU7VxyD37q9CW5q3pdqiJWDAExHdLuxAma4HGwMGfg4z3E9GeHvGZ8NQycGAydY3z3bXkFe1HmFVf9DqfHz5r4d.gif](https://cdn.steemitimages.com/DQmWiKuzWdfvTeZVCAQfhX657L3iA3VFaNRvH6PuRTSK9ST/4i88GgaV8qiFU89taP2MgKXzwntUGAvkoQiKU7VxyD37q9CW5q3pdqiJWDAExHdLuxAma4HGwMGfg4z3E9GeHvGZ8NQycGAydY3z3bXkFe1HmFVf9DqfHz5r4d.gif) ### **

1. a) Explain your Understanding of Trend Reversal. What is the benefit of identifying reversal patterns in the Market?

As a trader, it is pertinent to understand that the market can never move in a specific direction always. Whether it's cryptocurrency or stock, every asset will keep changing its trend from bullish to bearish and vice versa. So, that left us with 3 scenarios: bull market, bear market, and ranging market.

Suppose that there’s a price of the commodity that has been in a downtrend. However, it breaks the major resistance and starts a bullish rally that will be considered as “Trend Reversal” because the market won’t be in a bearish state anymore. Interpreting trend reversal is important for every trader because it helps to open and close trade according to the behavior of prices. There are several methods like the break of market structure, RSI divergences, and break of trendlines to find the potential change in trend.

I have used RUNE/USDT chart to show an example of a trend reversal. As you can see that the price was in an uptrend as indicated by the trendline, but it ends up breaking it, which is marked by a red circle. That was the potential trend reversal signal, and the market structure was changed from bullish to bearish. In that way, traders would have closed their long position on break of trendline and opened a short position.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![1.png](https://cdn.steemitimages.com/DQmcz1Qdx1GMiejyoHBrDkxXjpbHWcWc6xcodPsKFG1fT8r/1.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png)

There are a lot of benefits of identifying trend reversal. It can assist in finding the perfect entry and exit position with great risk to reward ratio. Plus, a lot of traders ends up in huge loss as they can’t manage their trades according to trends but once they learn about finding out trend reversal methods, it can be very beneficial in managing profitable trades.

b) How can a fake reversal signal be avoided in the market? (Screenshot needed).

Every professional trader advises to use several technical indicators, chart patterns, and price action tactics to add more confluence while opening a position. The key reason is that market can play with us some time by faking a breakout or breakdown. It can be full of disappointment to open a long position after finding a potential trend reversal, but it never develops the expected direction. It can also cause loss of funds, but this issue can be easily avoided by several methods.

I will show you how I prefer to find out fake reversal signals through trendline and a renowned technical indicator, RSI. As you can see that the price of LINA/USDT respected the resistance line, which was stopping it from starting a strong bullish move. However, the price broke the trendline that the majority of traders would have thought of a trend reversal, but RSI was at the overbought level. Thus, that showed us that bulls don’t have enough power to sustain the bullish momentum which means it is a fake reversal signal.

The bottom line is that if we had only used trendlines for trading, then it would have resulted in loss but using an extra technical indicator helped us. There are many other methods like using market structure, observing higher time frames, volume, etc.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![2.png](https://cdn.steemitimages.com/DQmT2CyMkNYQbqRDX5b48Mgyu3mPnrYkSgPQNAWdgeTwxzx/2.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) #### **

2. Give a detailed explanation on the following Trend reversal identification and back up your explanation using the original chart. Do this for both bullish and bearish trends (Screenshots required).

** ## **

Break of Market Structure

As we have learned in the previous course that if the price is bullish, then it will keep making a series of higher highs and higher low to sustain the momentum and the same goes for the bearish scenario. We can also find trend reversal with the help of market structure as the price will break the previous higher high or lower low. For better understanding, let’s take a look at both bearish and bullish examples.

Break of Bullish Structure

When the price of assets is bullish, it will keep making higher-high and higher-low to push the price upward with momentum. I have attached the chart pattern of DOT/USDT and marked every higher-high and higher-low indicating that bulls are in control of the market, but you can see that there comes a time when the price couldn’t form a higher high and ends up making a lower low by breaking previous high. Thus, it broke the structure of market and indicates that price is now in bearish trend.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![3.png](https://cdn.steemitimages.com/DQmRjW8pScAwqjvNDvSmfbvkubw6cqnzmrXzjdy75gPHWeb/3.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ## **

Break of Bearish Structure

Just like a bullish market structure, you will find that a bearish market makes a series of lower high and lower low, which makes a strong downtrend move. However, if the price fails to respect the previous lows and ends up with a higher high, then it will be considered as the break of structure.

I have marked the entire bearish structure of the market on BNB/USDT chart, but you can see that price failed to respect the previous lower high and formed a higher high which shows that the market structure has been broken and the downtrend is not valid anymore.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![4.png](https://cdn.steemitimages.com/DQmXZcptKaJn395sniY5w4AJkQRfejfADVZXY7dSiitw6w6/4.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ## **

Break of Trendlines

Traders widely use trendlines as it’s the simplest tool that helps in understanding the trend of the market and helps to find the potential support and resistance zone. We can also use it to understand the trend reversal as once the trend line is broken, we can expect the price to move in a completely opposite direction. Let’s take a closer look at both bullish and bearish scenarios:

Break of Bullish Trendlines

If a price of an asset is in an uptrend and respecting the support line, then we can deduce that it’s in a bullish state. However, if it breaks down from the trendline, then it can be said that the bull trend is not valid anymore as the price will be heading toward a downtrend. Let’s take an example of the MATIC/USDT chart. I have drawn a simple trendline that shows that price is in a bullish trend, but the break of trendline shows the change in market structure, and right after that market started a bearish trend.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![5.png](https://cdn.steemitimages.com/DQmUNKthowbvzrfpAbrdpzXtZxTPruBxkeqkQjNLBCyQ7af/5.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ## **

Break of Bearish Trendlines

You can find changes in the bearish market structure through the same method as bullish trendlines. All it takes is to draw a valid trendline on an asset that is in a downtrend and find a breakout. Let’s take the example of the LINA/USDT chart. As you can see from the below-mentioned image that it was in a downtrend, and the trendline is working as resistance as the price bounces every time by touching it. However, it ended up breaking the trendline, which was a trend reversal signal. Further, you can see that the price of the asset turned bullish after flipping the trendline.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![6.png](https://cdn.steemitimages.com/DQmceLaBKrRfk9GcNgDeieqSV6RbSncJYoHvgLu7bcmzGsu/6.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ## **

Divergences

Next to market structures and trend lines, divergence is also widely preferred when it comes to identifying trend reversals in the market. RSI is used to identify the potential change in the trend as the signal between the price and indicator will be inverse to each other. It gives a great insight into future price actions. So, let’s take a closer look at bullish and bearish scenarios:

Bullish Divergence

To identify the trend reversal in the market through divergence, you have to open the RSI first. Now, we have to observe the price action and RSI very closely. We can easily find the divergence if the price makes a higher high and the indicators make a lower low. It shows that the bear trend is getting weak, and we can expect a change in trend.

I have marked a bullish divergence on the VET/USDT chart, and you can notice that the price started a strong uptrend move right after that.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![7.png](https://cdn.steemitimages.com/DQmXxZyXihgv27oe3U2Z4kCV6aWzbhYapH6nDHqyomWQQf9/7.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ## **

Bearish Divergence

Similar to bullish divergence, we can find bearish divergence by observing candlesticks and RSI. The only difference is that price will be making a higher high, and the indicator will make a lower low. It indicates that bulls are losing control of the market, and there will be a change in the market structure.

Let’s take an example of RUNE/USDT as you can see that the price was making a higher high, and the RSI indicator made a lower low. It is the signal of a trend reversal, and you can see that the price also started a bearish rally.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![8.png](https://cdn.steemitimages.com/DQmafyJncc5K7N7AwPkAFiQTaoh6HCK6yAkWuuWND1J48K9/8.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ## **

Double Top and Double Bottom

Double top and double bottom are the most famous chart patterns as they can be easily identified in the market and gives insight into the price prediction of assets. As we have learned in the market structure that previous higher high or lower low must not be broken to maintain the trend in a specific direction. In the same way, double top and double bottom are formed as the price test the previous high or lows and fails to break it, due to which it ends up reversing the trends. I will demonstrate examples of both patterns.

Double Bottom

Double bottom is formed during the downtrend when the price fails to break the previous lower low. It is important to remember that the second tap must not be higher than the previous one as it will invalidate the pattern.

Let’s take an example from the TRX/USDT chart. As you can see, the price failed to break the previous lows and ended up making a double bottom pattern which indicates the change in market structure, and that’s what happened right after forming a double bottom.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![9.png](https://cdn.steemitimages.com/DQmV3n98dY4gbqW5Wy22tBG5qwAs2pWGRwbduqcrN6LN5CS/9.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ## **

Double Top

The double top is an important chart pattern that occurs during an uptrend and shows potential trend reversal. It is formed when the price fails to surpass the previous higher high, which also represents that the bulls are losing control of the market.

Have a look at the below-mentioned chart pattern of MATIC/USDT. You can see that it was in a bullish trend, but the price couldn’t surpass the previous higher high and formed a double top that I have marked as yellow. Thus, it ends up reversing the trend from bullish to bearish.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![10.png](https://cdn.steemitimages.com/DQmRgCMNr3J5Ekj9tGA7V2oHHCTu8PNY6AfRg4EkXwJcKiZ/10.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ## **

3. Place a demo trade using any crypto trading platform and enter a buy or sell position using any of the above mentioned trend reversal/continuation pattern.

I have learned about trend reversal and various methods to identify it. Now I will be sharing how to trade change of market structure from any method.

I found a double top on BTC/USDT, which means that price can break its bullish momentum and start a downtrend. So, I opened a short position at the market price by purchasing 0.05 BTC with risk to reward ratio of 1 and a tight stop loss at 57427 and take profit at 56093.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![11.png](https://cdn.steemitimages.com/DQmR8eLi7z9zwdWo6BKghamwRH2tzVj1FAB2QFgCm2GhrWg/11.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png)

Later, the TP was successfully hit, and you can see from the below-mentioned screenshot that the asset was sold in profit.

![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ![12.png](https://cdn.steemitimages.com/DQmPgN9ySzJMjGxGTF3xjLs4fv86JGCqYoxwWjFka3LbaJn/12.png) [Screenshot Source](https://www.tradingview.com/chart/nCj46NvG/) ![C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png](https://cdn.steemitimages.com/DQmcTH2T3Q7oNJzNVPXZepxF7nSuxYmpnRr18zdFtPjHe85/C3TZR1g81UNaPs7vzNXHueW5ZM76DSHWEY7onmfLxcK2iQMm1KRe2KsZpaQLHDyvnu8HoCxckZYePiSGvWaFNTvHbyziKpKp8aD4UViN7hj21qns4puxfci.png) ## **

Conclusion

After completing the entire project, I have come to the point that it is very important for traders to learn about trend reversal as that’s the primary factor that helps to manage the trade. It is widely said that “Trend is Your Friend” and that truly applies to the crypto trader, so everyone should learn how to identify the change in trend through the most preferred methods like double top/bottom, divergences, break of trendlines, and others. Overall, it was an honor to learn such knowledgeable trading tactics from professor @reminiscence01.

![qjrE4yyfw5pEPvDbJDzhdNXM7mjt1tbr2kM3X28F6SraZdKzByGAYdtt1XATaczwhH9gQq7vEfKiNortStnHAisofkdee6c64Phv3JgwfuYMxYLci8obrpP8.png](https://cdn.steemitimages.com/DQmPNftLA64k9MJx1PuvCfui2EW4cCLqdMWJb53BrbRURjg/qjrE4yyfw5pEPvDbJDzhdNXM7mjt1tbr2kM3X28F6SraZdKzByGAYdtt1XATaczwhH9gQq7vEfKiNortStnHAisofkdee6c64Phv3JgwfuYMxYLci8obrpP8.png) **Thanks For Visiting My Post And Your Appreciation** **Cc:** @reminiscence01 ![1637074190054.png](https://cdn.steemitimages.com/DQmNZEqrC3CaVtAZjzhi5y6Dg2S3mPRsvdZgbRj28CQaKCS/1637074190054.png)