Since the Elliot wave was introduced in the 1930s, charts have been used to find buying and selling patterns. If you are looking to day trade Crypto there are some great trading companies you can follow who do this 24/7 as the Crypto markets never close.
My philosophy, as I don’t intend on staying up 24/7 to watch for patterns, is to buy the dips on a great crypto, let it double or triple, then pull my original investment or position out and let the house money ride through the ups and downs. If it is one of my top cryptos I'll let it ride and just buy the dips, no selling.
If it were to triple again after that, I would pull out my position a second time. Everyone has different goals and tolerances, which is why I only can tell you what I would do in certain situations.
When I pull out of this position, I trade it for Bitcoin. Bitcoin is always my biggest investment as it is the safest bet for new money coming into the crypto market and thus remains stable compared to the alt coins.
There are 3 charts to be aware of that are harbingers of swings up or down. I use these charts along with Resistance and support levels and trendlines which I will show in a bit. I am using Tradingview to find and edit these charts.
Adam and Eve is a small bottom followed by a bigger bottom that precedes an upswing. Here is an example.
Head and shoulders also can be spotted pretty easily, here is an example of that. You can see the shoulders and head along with the neckline which defines this pattern.
Cup and handle formations can precede upswings and look like this.
Support and resistance lines are very important to find when looking for pattern. You can find them when there are 3 or more candles and the middle candle is the lowest or highest depending on resistance or support.
Remember to count the wicks also. In the following example you will see resistance and support lines, also you can see when support turns to resistance or vice versa as the line is broken through.
Go through 100 coins or so and learn to find these patterns and it will soon become easy to spot.
Trend-lines can also be important if used with support & resistance lines. You can find where they intersect and come up with a better game-plan as to where to enter your position.
From the top of the high-point, just rest the trend-line on areas of resistance until you intersect with a strong support line. Sometimes those support lines carry from previous trends on the same coin which bolsters confidence that this is a good place to enter.
Pattern recognition takes practice, but once you start seeing them it will become an important part of your investing strategy.
Feb 20, 22 11:33 AM
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May 31, 20 05:17 PM