E Gold And Bitcoin Chart Patterns: Are They Bullish?

Okay, time for a pop quiz: Can you identify the asset and the chart pattern shown below?

Courtesy: Barchart.com

If you said "gold" and "rounding bottom" chart pattern, you're 100% correct! (I'll give you half-credit if you got one of those answers but not both. I'm an easy grader!)

If you're thinking that gold's rounding bottom pattern looks familiar, you might be thinking of another well-known alternative to stocks which experienced the same pattern. Let's see if you recognize this one:

Courtesy: Barchart.com

Did you immediately recognize this as Bitcoin vs. the U.S. dollar? If so, then you're batting a thousand -- well done. As we can see, the Bitcoin price rocketed upwards after completing the rounding bottom pattern, fulfilling its bullish denouement. If there's any predictive power to these patterns, then the same destiny could befall gold; considering its intensely bullish price action throughout August, it's hard to imagine any other outcome at this point.

For today's final quiz question, see if you can identify the asset class and chart pattern below:

Courtesy: Barchart.com

You'll have to forgive me, but this was a bit of a trick question - it's Bitcoin again, just on a different time frame. Regarding the chart pattern, it's a symmetrical triangle; whether this resolves upwards or downwards depends on whether the price breaks with conviction (i.e., high volume) above the resistance line or below the support line - only time will tell.

I employ the honor system in my classroom, so I'll let you grade yourself on today's quiz. Your homework assignment is to keep your eyes on the charts... and the hype out of your trading.

Disclosure: David Moadel is not a licensed or registered investment advisor, and has no position in any securities listed herein.

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