Bitcoin head and shoulders and how to trade them
wanted to post this because I see so many people commenting on and trading these patterns "incorrectly."
I put incorrectly in quotes bc I acknowledge that it's subjective. This is ideal from a risk/reward standpoint. Whether one is right or wrong really doesn't mean that much in trading if you make a lot more money when you are right than when you are wrong (or vice versa).
The most important thing is risk/capital management and what chart patterns are good for is identifying levels of maximum profitability. I was influenced to make this post from a recent comment of Peter Brandt on twitter which seemed to confuse people but he is absolutely correct. His comment was
"I have made my living since 1975 trading futures markets using charts
My conclusion on chart trading:
1. Charts do NOT predict prices
2. Most chart patterns fail
3. Charts simply tell us where a market
has been
4. The only value in charts is for trade/risk management"
I put incorrectly in quotes bc I acknowledge that it's subjective. This is ideal from a risk/reward standpoint. Whether one is right or wrong really doesn't mean that much in trading if you make a lot more money when you are right than when you are wrong (or vice versa).
The most important thing is risk/capital management and what chart patterns are good for is identifying levels of maximum profitability. I was influenced to make this post from a recent comment of Peter Brandt on twitter which seemed to confuse people but he is absolutely correct. His comment was
"I have made my living since 1975 trading futures markets using charts
My conclusion on chart trading:
1. Charts do NOT predict prices
2. Most chart patterns fail
3. Charts simply tell us where a market
has been
4. The only value in charts is for trade/risk management"
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