In my opinion, it is hard to advise acting on this psychological pattern as the pattern forms. Hoping for the completion of a pattern or basing a short/long during the formation of the possible pattern can be reckless; however, acing in hindsight on the formed or rejected patterns can serve as a powerful indicator of strength.
There are 3 patterns I outline in yellow and one large pattern in white. Two of the yellow patterns (if the current one completes) with heads at 4475 can be utilized as local top indicators of strong resistance.
The larger scale yellow pattern with the neckline at 3550 was not fully formed; however I saw many people short due to the potential pattern. Instead, waiting for confirmation of the pattern would have been a better move and acting on the pattern with hindsight would have been less risky with great rewards. With a rejection of the pattern, we saw clear bull strength taking the market to reversal territory. Had the pattern completed, excellent low risk entry positions at ~3300-3400 (or 2980-3000 if it had fully completed).
The largest (white) pattern is somewhat of a joke and basing the all time top of BTC at the head of the pattern is reckless. Basing shorts/longs on the large scale pattern (although it has been mentioned) is nothing more than gambling.
These are my opinions on and they can be drawn in many ways, but still serve as excellent indicators in hindsight.
Would appreciate thoughts/opinions on the use of as predictors vs indicators.
I can't help but wonder if what's happening is that weaker hands are trying to be shaken out so that they can be gobbled up before another run up.
Also, Wreck em Tech!!! ;)