Using patterns to achieve day trading success
Bitcoin and the whole cryptocurrency markets went crazy over this weekend, things went from good to bad very quickly, and for over 410k trading accounts it went from bad to horrible very quickly, because as you can see below over 410,000 trading accounts were liquidated due to margin calls (meaning they lost all their money trading crypto).
The total losses were also very big, over $2.6 billion USD were lost in just 24hours. One of the major reasons that happened is because these traders were just trading based on hope, their systems didn't show them what our system would have told them (see below).
Bitcoin dropped yesterday as much as 22% before recovering a large percentage of that loss, since its high of 69,000 is down, at the present time, 28%, now a day trader who actually has tools and processes to understand that the short-term is down they could have grabbed this move and made a substantial profit by simply using the VWAP to trail their stop loss.
Now I say the above based on the fact that the short-term trend was down, but if we take a look at the 1D chart, see below, you will notice that both BTCUSD and ETHUSD are showing very solid signs of upside, and since we believe that we are due for a bullish rally not only on crypto but also the stock market, our own independent analysis and should not be taken as advice, we are taking longs on ETH.
I think that the main skill you need to learn to become a successful day trader is to learn the language of price action, which at the end of the day is just looking at the highs and lows, then using them to give you the guide on where the markets are going.
Once you have the direction all you need to do is wait for your edge to show up and then execute it!
The point of this blog post is to use patterns to achieve day trading success, so let me finally talk about that, what we have on that 1H chart of bitcoin is a bearish flag / bearish continuation, then all we had to do is connect a few basic tools, like the Fibonacci retracement and our indicators and then all we had to do is what I state above, wait for our edge to appear and trade it!
Do you want to make money day trading the markets (crypto, forex, stocks)? Super, develop patience to wait for the right setups and entries, don't just trade everything that comes along, follow your entry rules and you will make money day trading the markets!
VIDEO EXPLAINING WHAT YOU COULD HAVE DONE:
VIDEO ON WHAT YOU COULD DO NOW:
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