What are “waves” and why should cryptocurrency traders care?

waves

tl:dr?  Key takeaways and a useful chart are at the bottom of this post.

Waves refer to a method for analyzing markets called “Elliot Wave Theory” that says the market “ebbs and flows in clear trends”.  Like everything else in trading analyzing waves can be as complicated as you want to make it, but we like to keep things simple.

Waves are a type of pattern (just like candlesticks, volume and many other indicators create patterns, cryptopatterns considers them all as part of our analysis to “build our case” for moves in the cryptocurrency markets).  Here are 3 keys to waves we use in our pattern analysis that might prove useful in your trading efforts.

1. If you look at investment price charts over years, you can clearly see buying and selling patterns move in waves.

If you know the market moves in waves, and you see these waves repeated over decades and a wide variety of investment vehicles, don’t you think it would be helpful to your crypto trading to know how those waves work and where we are in the “wave cycle”?  We do.

2. Exact wave counts are extremely hard to identify in real time, and there are multiple interpretations of which wave we’re in by simply looking at a single price chart.  

Just take a look at this example and you’ll see:

waves complex

chart source: Safehaven.com

3. KEY: Waves come with certain identifiable “market behaviors” and this is where waves can prove most helpful in assessing probabilities in your trading strategy.

Here is a solid overview of those behaviors–pull out a chart of your favorite crypto and see if you can identify the waves using these behaviors.

wave definitions

What’s the takeaway?  Learn the basics of waves, and be sure you consider them in your trading strategies or you might find yourself buying when there are screaming red flags that say “now is the time to be selling!”

Of course, you can also subscribe to cryptopatterns newsletter and get daily updates and analysis on our take on wave counts along with other important patterns for all the most important cryptocurrencies  as well as newer ones in the market that can give you the edge to trade or invest with probabilities on your side.

This site is for informational and entertainment purposes only and not in any way intended to be investment or trading advice.  You are 100% responsible for your financial decisions at all times.  It is highly recommended you DO NOT  make any investment or trading decisions depending upon what you read on this blog/newsletter!  All information presented (c) 2017 JBP cons, inc.  All rights rese

How (and why) to define your BTC cryptocurrency trades VST ST IT or LT to make money

trading guidelines 6 20

Sure, it’s impressive to read the trader’s post on Reddit bragging about turning $300 into $50,000 trading crypto in a year.  Bitcoin’s skyrocketing – maybe it could be you next?

It happens, but the odds are overwhelming that it won’t happen to you.

So if you’re like the rest of us in the real world who seem to always “just miss” that home run trade, cryptopatterns is here to show you how you can make real money trading cryptocurrency.  It may not be reddit worthy, but it can pay the bills and definitely beats joining the 90% of traders who funded that annoying trader’s $47,700 in profits.

Making money trading crypto for years

For some additional useful reading check this post out:

5 Steps AND REAL TIME TRADE SET UP to profit trading (and losing) in BTC Cryptocurrency now

Part 1: Define your trade 

trading guidelines 6 20

Some additional notes about this table:

  1. What you’re thinking is more key than the investment itself!  You might just think you’re investing $1000, but if you need the $1000 next week to pay your credit card, that’s a whole lot different than investing the $1000 to start a retirement plan.  Same $1000–very different definitions for the trade, get it?
  2. The more you invest, the stronger the case needed.  This is where most of the money is lost by traders.  Jumping into insanely high risk trades without really believing in the outcome– hoping rarely works out well.  If you are a cryptopatterns subscriber you have seen just how much information can be used to “build your case” and get probabilities on your side before you invest.   How much information most traders have no clue about.
  3. The more you invest, the more you want time (and probabilities) on your side. Look, everyone would love to be a professional gambler if they could gamble full time and make huge money. Do you really think that’s how your trading efforts are going to work out?  Will everyone be right and get rich trading?  How about proving you can make ANY money trading for a few years before you go all Phil Ivey on us?  Make your biggest trades/investments the ones you can truly sleep at night holding knowing you’ve assessed the risk, defined your trade and probabilites are clearly on your side.
  4. Don’t trade without defining risk as VST ST IT or LT  Unless you’ve CONSISTTENTLY turned $300 into $50000, now is a good time to build a long-term trading plan that can work for years in the real world of cryptocurrency trading if you are serious about putting probabilities on your side.
  5. Subscribe to cryptopatterns newsletter.  We’re the voice of reason and real world trading education.  We teach you how to win and lose, be consistently profitable with good returns (great vs most investments) and, most importantly, stay safe and stay in the game.  cryptopatterns newsletter is definitely the place to be for everyone who doesn’t routinely turn $300 into $50000 trading cryptocurrency.

PART 2 Position Management Strategy coming soon……

 

This site is for informational and entertainment purposes only and not in any way intended to be investment or trading advice.  You are 100% responsible for your financial decisions at all times.  It is highly recommended you DO NOT  make any investment or trading decisions depending upon what you read on this blog/newsletter!  All information presented (c) 2017 JBP cons, inc.  All rights reserved.

REAL TIME Bitcoin Trade Set Up Shows How to find Patterns and Targets

HeadandShoulder

A basic “pattern” in trading crypto (or other investments)  is a shape with certain characteristics that appears on price charts and indicate a predicable move in price.

A common example that most traders quickly become familiar with is the “head and shoulders” pattern (HS) .  The name says it all as you can see in the pic above.

Over time, patterns have emerged that allow you to predict what happens to price after a HS pattern occurs that gives traders a tradeable “target”. For example, the head and shoulders pattern typically anticipates a bearish result (drop in price):

CAReport_HeadShoulder target

Source for HS and IHS charts: Investopedia

If a price chart shows buying and selling patterns, and the HS pattern = bearish result,  it should make sense that in “inverse” head and shoulders (IHS) = bullish result, right?

inverse h and s

NOTE: subscribers to cryptopatterns newsletter are often shown “volume” patterns in addition to price patterns and you can see an example in this chart – volume typically spikes on breakout of an IHS. That’s an example of “confirming a pattern”

REAL TIME BITCOIN PATTERN AND TARGET ANALYSIS

So can simple patterns on charts be a better predictor of moves in price than the latest crypto news about “halvenings”, miners squabbling about segwit, reddit bitcoin gurus predicting BTC 100000 while mocking altcoins and Goldman Sach’s discovering bitcoin and now sharing expert views?

Yes. Though don’t take that to mean the patterns always work–because nothing always works.  But let’s go to the charts and see what the patterns and targets have to say about what’s next for BTC

BTC IHS 6 18

Notice, the price pattern by itself wasn’t enough to analyze the chart. cryptopatterns is always saying “volume doesn’t lie” and on the first breakout of the IHS Bitcoin didn’t have the volume,, and back price came.  Now we have a breakout with volume.

SO WHAT’S THE TARGET PRICE FROM THIS IHS PATTERN?

Traders are taught that the target for an IHS is = the distance between the head and the neckline, so here’s what that looks like in the case of our real time BTC trade:

btc ihs target

Targets can change based on where traders draw their lines so they are only approximations, but they can give you a “target range” that can be very useful for trading.

IS TRADING PATTERNS THAT SIMPLE?

Is BTC heading for $2880? What about that article today saying BTC has no future?  More importantly what patterns and indicators can emerge that can confirm the target is likely to fail or be reached,  or perhaps skyrocket past it (which BTC did multiple times from $850-2900)?

Obviously, there’s no guarantee BTC will reach $2800 because of a certain shape on a chart (there are many more patterns than HS and IHS).  If it were guaranteed. 90+% of traders would be making money instead of losing it which is what is really happening out there (not just in crypto–in all asset trading).

EXTRA CREDIT: Study the LTC charts from the last few days to see if you can now see how cryptopatterns identified Litecoins breakout move.

But for answers to how gain an edge in knowing where BTC is heading so you can invest in, trade, or just understand the BTC and Altcoin markets better, studying patterns and targets is essential for a trader who wants long term success.  We also believe subscribing to cryptopatterns newsletter can be a helpful (and profitable?) part of your studying,  as there is far more to the pattern and target story than most ever dreamed possible.

This site is for informational and entertainment purposes only and not in any way intended to be investment or trading advice.  You are 100% responsible for your financial decisions at all times.  It is highly recommended you DO NOT  make any investment or trading decisions depending upon what you read on this blog/newsletter!  All information presented (c) 2017 JBP cons, inc.  All rights reserved.