Patterns do repeat, but in the end the MOST IMPORTANT RULE for success in investing is risk-reward ratio. All great money managers talk about this.

Paul Tudor Jones, considered one of the best in history. Never put on an investment that he didn't see a 5 to 1 on risk -reward scenario.

We can use charts to find those points. Let's take a look at LTC daily chart:

The candle circled in GOLD, was the entry candle as it formed the bullish u-turn pattern that I use for crypto buy signals.

Entry price is 130, down side is 100, which is bottom of that candle's wick.

Risking 30 - what are the profit targets? They are resistance points/prior tops.

If one think's LTC is going to the all time high again. Your risk reward is 8 to 1, which is great! You don't have to be right often to make money.

However, what are some nearer targets that could work for active trading as well:

First top is 191 = $61 profit. Second top is $212 = $82 potential profit. Third top is $265 = $135 potential profit.

Giving us a 2 to 1 ratio, 2.7 to 1 ratio and 4.5 to 1 ratio, respectively.

This is exactly what makes that entry so good. Not just that we got a reliable u-turn pattern entry, but that every trade scenario offers a sufficient risk-reward scenario.

Never take less than 2 to 1 and the higher the better.