Crypto Academy Week 14 - Homework Post for @fendit

It is my pleasure to participate in this wonderful lecture by professor @fendit. After i had leant from this lecture, I decided to prepare this homework.

The Composite Man

The composite man is always winning due to his smartness and his technique of cleverly following the trend of the market to know when to accumulate or distribute the asset. This technique was invented to give an idea of the reaction of the market. The Composite Man is a smart investor and trader who is wealthy and smart enough to follow the trend of the market. The Composite Man buys at a low price and sells at a high price, which generates more profits for the trader.

The new traders can also use the techniques of the Composite Man by following the reaction of the market and discover the moment the Composite Man is, and take advantage of the wave at the perfect moment. Wyckoff Method is very useful to know when to buy or sell the asset.

The Composite Man uses four very useful techniques to make profits. These phases include:

• Accumulation

This is the moment the Composite Man buys a large asset to sell when the price falls. The Composite Man studies the asset to know the asset first to know the right asset to and when to accumulate asset.

Uptrend

• Accumulation

In this phase, the price of the asset goes up as a result of the scarcity and hoarding of the Composite Man. The scarcity makes the demand to be greater than the supply.

• Re-accumulation

This a phase when the Composite Man buys more asset because the uptrend stop for a while and the continued with its upward trend.

Downtrend

• Distribution

This when Composite Man begins to sell their accumulated asset and also formulate another strategy to buy when it is low as a result increase in supply.

• Redistribution

This is the phase when the Composite Man redistributes the asset because the downtrend stops for the while and then continued.

Fundamental Laws

Demand and Supply

The price of an asset is determined by demand and supply. The higher the demand leads to a higher price, the higher the supply leads to a low price and vice versa.

Demand and Supply can help us to predict when there would be a high price of an asset and a low price of an asset. This helps to know the right moment to buy an asset or exit.

Cause and effect

Composite Man is the factor to be considered when talking about the cause. The scarcity and hoarding of large investors lead to upward and downward movements of prices.

The law of cause and effect is about the accumulation and distribution to the right moment of entry or exit. It also established that no movement in the market happens by accident and it gives the idea of the market trend.

Effort vs Outcome

This law explains to us that when we seeing an increase in the volume we should consider the change in trend or breakdown to predict the entry and exit moment. The big investors had to create the trend explained in the phase. Look at the trading volume can help to predict the trend. The large volume is a result of the great effort of some forks.

Share a chart of any cryptocurrency and analyze them using this method. It clearly shows the different phases, how the volumes changes and gives details of what you're seeing

Screenshot from binance

Accumulation
The screenshot shows there not much variation in its movement. That phase a perfect moment to accumulate and meet till the price fall.

Re-accumulation
This is the phase we buy more because the uptrend stop for a while, and its movement starts again.

Distribution
This is the phase we start to sell our assets because the price has begun to fall. With this strategy, we will be able to make a huge profit.

downtrend
The downtrend phase is moment to sell our asset. In the process of downtrend there would be a moment when downtrend will stop for a while then will can redistribute.

Conclusion

This method has its advantages and disadvantages. The is smart and wealthy investor takes advantage of this strategy and makes a huge profit. The Wyckoff method is a method that is very useful for our daily trading and helps to know the right moment of entries and exits, to maximize our profit. The beginning can learn from this method.