Technical Patterns

Definition ∞ Technical patterns are recognizable formations that appear on price charts of financial assets, often used by traders to predict future price movements. These patterns are derived from historical price and volume data. They serve as indicators for potential market reversals or continuations.
Context ∞ In cryptocurrency markets, technical patterns are widely analyzed by traders seeking to identify entry and exit points for digital assets. News articles and market commentaries frequently reference these patterns, such as head and shoulders or triangles, to explain price action. While popular, the predictive power of technical patterns in volatile crypto markets remains a subject of ongoing debate.