Steemit Crypto Academy | Homework Task 3 For @stream4u | What is Chart Patterns? | Price Breakout - Continuation Patterns - Reversal Patterns | STOPLOSS.

Today I formally join the Steemit Crypto academy with my very first post related to class 3 of Chart Patterns.

First of all I want to thank @steemcurator01 and @steemcurator02 for the opportunity they give us to learn these valuable tools and @stream4u for his time and dedication in preparing these magnificent classes.

I wanna say that even though I'm submitting this as my first assignment, I actually previously read and studied the last two classes. For this reason I was a little late in the delivery this week.

Let's get started.

Q1. What Is A Chart Pattern?

1.A chart pattern is a graphical aid or graphic pattern that occurs within the chart that indicates the behavior or trend of the price of an asset during a period or time scale, which can range from hours, days, weeks, months and that allows you to predict or at least forecast its future behavior.

_{1- Chart Pattern: STEEM/USTD chart, taken from POLONIEX on February 25th, 2021. Edited by me.}

Its importance lies in the fact that by reading them we can establish the entry or exit points in a trading operation, in addition to helping us establish the stoploss level.

Q2. What Is A Price Breakout?

2. Price Breakout is simply a movement that occurs when the price of an asset tends and actually manages to break the support or resistance barrier. In the case of support, it is situated below and in the case of resistance, it is situated above.

_{2- Price Breakout; example for Resistance Breakout: STEEM/USTD chart, taken from POLONIEX on February 25th, 2021. Edited by me.}

Q3. What Is A Continuation Pattern?

3. The Continuation Patterns is wich indicates that the price of an asset tends to maintain its uptrend or downtrend trend, as the case may be.

_{3- Continuation Pattern: STEEM/USTD chart, taken from POLONIEX on February 25th, 2021. Edited by me.}

Q4. What Is A Higher High Formation?

4. This is the pattern where the close price ends up being higher than the open price. Or in other words, where a clear sustained increase in the price of the asset is observed.

_{4- Higher High Pattern: STEEM/USTD chart, taken from POLONIEX on February 25th, 2021. Edited by me.}

Q5. What Is A Lower Low Formation?

5. This is the pattern where the close price ends up being lower than the opening price. In other words, where a clear sustained fall in the price of the asset is observed.

_{5- Lower Low Pattern: STEEM/TRX chart, taken from POLONIEX on February 25th, 2021. Edited by me.}

Q6. What Is A Reversal Pattern?

6. A Reversal Pattern contrary to the Continuation Pattern, is one that indicates that the price of an asset is preparing to undergo an upward trend change and begin a decline or a downward trend change and begin an increase.

_{6-Reversal Pattern : ETH/USDC chart, taken from POLONIEX on February 25th, 2021. Edited by me.}

Q7. What Is A Double Top Pattern?

7. A Double Top Pattern is one where after a Higher High pattern, we find two high points at the same level. This indicates that the asset price trend will change from uptrend to downtrend.

_{7-Double Top Pattern : ETH/USDC chart, taken from POLONIEX on February 25th, 2021. Edited by me.}

Q8. What Is A Double Bottom Pattern?

8. A Double bottom Pattern is one where after a Lower Low pattern, we find two low points at the same level. This indicates that the asset price trend will change from downtrend to uptrend.

_{8-Double Bottom Pattern : ETH/USDC chart, taken from POLONIEX on February 25th, 2021. Edited by me.}

Q9. In Investing & Trading What Is The Importance of Stop Level(STOPLOSS)?

9. The STOPLOSS is the maximum level of losses that the investor can afford. Its importance lies in the fact that the trading operations can be extended over months, however the trend variation or price changes of the assets can occur in a minute. It is humanly impossible for the investor or the broker to constantly check the market price or be aware of any variation. As much as we are careful to check the movement of the market, there will be occasions where for some reason we won't be present in the operations.

This is where STOPLOSS comes into play, since this is a level that we previously select before entering an operation and acts as a remote insurance or safety valve, which gives the order to exit an operation as soon as the level of loss allowed is exceeded. Since this order is previously established, it is not necessary for the investor to approve it at the time it occurs, thus protecting the assets from a greater loss.

Q10. Where To Find & How To Set A Stoploss?

10. We can find the Stoploss level by following the asset's previous price history and by looking at the previous supports levels and comparing them to our allowed loss level.

_{10.1-Where to find a Stoploss level : STEEM/USDT chart, taken from POLONIEX on February 25th, 2021. Edited by me.}

After that we must find at least two supports levels in the price history, the first one will help to establish my most immediate entry point, but more importantly; I must find a second support, prior to the first support which will become my STOPLOSS.

_{10.2-How to set a Stoploss level : Example taken from POLONIEX page. Edited by me.}

In order to set a stoploss, most platforms or pages dedicated to cryptocurrencies trading have an option within their operations panels, which is intended to set the stop price. In these boxes the minimum price that can be allowed is set.

Q11. What Understood From This Course?/ Conclusion.

Well, I think the first thing I should say is that being able to learn everything by its name, being able to visualize a Chart without fear is already a great achievement. Before this course I didn't even know what a Candlestick Chart was, least of all its implications and importance.

Thanks to this course I learned about what a Price Chart means. I really believe for those who Know How to read it, it is an invaluable help in the cryptocurrency and assets market, that placed you over the competitors.

Specifically answering the question, I have learned the basics of trading by reading the Charts and identifying their basic patterns, such as the higher high, lower low, double top, double bottom. And even more interesting, by observing these patterns to be able to establish an entry or exit point for an operation and establish a STOPLOSS through the support levels.

The market behaves unpredictably every day, but with these tools you can keep risk under control. And I think that's exactly what the stock market is all about, keeping risks and losses under control and within an acceptable range.

Finally, I know there is still a lot to learn, but as far as I am concerned, I feel confident to start operating and apply what I have learned.