Make an investment of $12 or more. Show screenshots of the process. Why did you choose this cryptocurrency?

In this task, I chose Cardano (ADA) because of the value it creates in the cryptocurrency space. First and foremost Cardano and ADA are two different things, that is, Cardano is a blockchain platform while ADA is a cryptocurrency used on the Cardano blockchain. The Cardano blockchain can not only be used to send and receive ADA but will also host smart contracts and applications. Cardano shares many of its roots with Ethereum but although they seem similar, Cardano’s smart contract platform operates much differently. It is not enough to say that ADA lives on the Cardano blockchain but it is a proof-of-stake coin that fuels Cardano with the purpose of providing a quick and secure value and allowing users to operate smart contracts and applications.

Steps how I made an investment in Cardano worth $12.5 from Binance exchange.

What is the market capitalization?

Cryptocurrency market capitalization is a useful matrix to learn the monetary of cryptocurrency, that is, a coins’ market cap is calculated by multiplying the total circulating supply of the coin by its price. Therefore, currently, the market capitalization of ADA is $42,026,380,030 at the time of writing this post.

What is the position in the crypto asset rankings?

Ranking in cryptocurrency depends on the assets’ market capitalization, trading volume and the demands of that specific asset. In this case, ADA is currently ranked number 5 on coinmarketcap.

What is the objective of the project behind the coin?

The main objective of Cardano is to create a stable currency and solve the problem of scalability and reduce transaction fees with its Ouroboros proof-of-stake algorithm.

Who founded this coin?

The founder of ADA was Charles Hoskinson in September 2017.

Show the roadmap of the coin.

Cardano roadmap consists of five eras that have been put in place to bring people closer to sustainability, self-governance and ultimately full decentralization. The five eras include Byron, Shelley, Goguen, Basho, and Voltaire.

What is the specific purpose of the cryptocurrency?

Explain in your own words what the “Evening star” pattern consists of. What is its hit rate?

The evening star is a three candle reversal pattern that only occurs on market tops. It is a bearish reversal pattern and the price action leading up to an evening star must be an uptrend. The first candle has a green bold body continuing the trend in the upwards direction, the second candle ideally gaps up at the open with a small body in comparison with the previous candle and the third candle ideally gaps down from the close of the second candle isolating that second candle above the first candle. The third candle has a red real body that penetrates into the body of the first candle, that is to say, the further the penetration downwards, the more bearish the pattern is and closing below the low of the first candle would make the pattern most bearish of all.

Confirmation of the pattern is price trading below the low with the third candle. Considering the sentiment of the evening star, the first candle continues the uptrend with everything looking bullish at the start, the second candle gapping up at the open continuing to look bullish but with a small body which indicates the weakening of the bullish sentiment and possibly indecision. This will partly shake the confidence of the bulls and price continuing in an uptrend direction at least in the short term and the third candle is then further damaging for the bulls since the bears have dominated due to the point of indecision and price ideally gaps at the open continuing lower into or beyond the body of the green candle which shows that the bears are at the utmost ground to take over the market trend.

The hit rate of the Evening Star candlestick pattern is 72% according to Thomas Bulkowski a computer scientist and a stock expert.

Explain in your own words what the pattern “Abandoned Baby” consists of. What is the percentage correct?

The abandoned baby pattern is a multiple candlestick reversal pattern, that is to say, it is a unique and reliable candlestick pattern. That formation of the abandoned baby candlestick is similar to the Island reversal pattern. The two types of the abandoned baby pattern are the bearish abandoned baby and the bullish abandoned baby.

Bearish abandoned baby.

This particularly signals reversal to the downtrend and it is used by traders to exit a buy position and enter into a short position. It is formed at the end of an uptrend being compose of three candlesticks. The first candlestick is a large bullish candle followed by a Doji candle that gaps up and the third candlestick opens lower than the Doji usually a bearish candle. After the formation of this candle, traders expect the price of an asset to continue moving down and bears are back into action.

Bullish abandoned baby.

This is a bullish reversal with a perpetual history of reversing. The major problem is that it is difficult to find it because the candle is rare with a frequency rank of 92/103 candle types. When you confirm it and assuming the price breaks downwards, you can make some change, however, the bear markets numbers are fewer than 20 samples so the performance is not likely to stand up. Here the first candle is always a bearish one followed by a Doji whose shadows gaps below the first day’s close and the third candle is a bullish one with no overlapping shadows. The break beneath on the second candle stimulates the bears and the close on the second candle is almost similar to the opening of the second candle that could be a sign of temporary profit-taking by the shorts although the third candle reveals that they are more likely scenario of indecision in the second candle.

Traders should take note when day trading with this kind of pattern that the first trend should be an uptrend in the case of a bearish abandoned baby pattern and the prior trend should be a downtrend in the case of a bullish abandoned baby pattern. The shadows and the real bodies should not overlap each other and the third candle should be in the opposite direction of the first-day candle gapping into the opposite direction of the Doji.

69% is the accuracy rate of a bearish abandoned baby pattern and 70% being the accuracy rate of a bullish abandoned baby pattern.

Perform analysis for 3 and 7 recent calendar days for Bitcoin. Do you identify any patterns? Show screenshots.

Analysis of pattern formed on Bitcoin chart for 3 calendar days.

I discovered a double top pattern forming right at the support level which was resistant, that is, the top of the market was tested twice forming an M . The pattern started on 29th July 2021 until the 30th of July.

Analysis of pattern formed on Bitcoin chart for 3 calendar days.

I found out a bearish engulfing pattern whereby on 27th July the red candlestick gapped slightly above the green candlestick and closing below the low, that is to say, the body of the bearish candle engulfed the body of the previous green candle.

In conclusion.

Traders always ought to make detailed research and analyze the particular coin or asset they would want to invest in so as to avoid getting huge losses from the crypto space. Therefore I would like to take this opportunity to thank professor @imagen for this wonderful lecture that has acknowledged me about trading crypto.