Hello, friend's this is 3rd week of Crypto academy, and here's my homework for this week, given by our crypto professor @stream4u.

So let's start with the Questions.

1. What Is A Chart Pattern?

The chart pattern is nothing but the diagrammatic explanation of the movement of the price of a particular coin or an asset. From which we can prevent the movement of the price of that asset or coin.

This is the chart of the ETH. You can find the different-different patterns depends on the different time slabs.

2. What Is A Price Breakout?

Price Breakout is the point or the moment when we expect that the asset or a coin will changes its trend but it continues its current trend & does not change its trend. means if any asset is moving in uptrend and in last week we learn about resistance. so we expected that from the resistance point the trend gets change and the price come down but against the expectation, the price crosses the resistance and continue its current trend. Same in the case of support and downtrend.

In the above picture, you can see that price of ETH go down by so much point after that it recovers from there, which means we can say that it gets support at that level and we can assume that now it will change its trend but it not and it still going in the downtrend. So it can be one of the examples of Breakout.

3. What Is A Continuation Pattern?

Continuation Pattern is the pattern that indicates that the coin or asset is going to follow its current trend i.e. if it's in an upward trend it will follow the upward trend and vice-versa.

This is the current chart of eth where it forms a lower low pattern which indicated it will follow its downtrend and as you can see that it's in a downtrend from the past week.

4. What Is A Higher High Formation?

In higher high patter the price of asset touch the new high and fall down with some price but in a short period, it again goes up and forms the new high.

This pattern is can be an example of a Higher high pattern here you can clearly see that price reaches too high but again fall down and after some sort of period, it again move toward up and forms a new high.

5. What Is A Lower Low Formation?

The lower low is the same as the Higher high but just in the opposite manner. In higher high, it continuously reaches a high point whereas in lower low it comes back to the lower point and forms the new bottom.

This is the example of a Lower low pattern where the coin tries to go upward but it again came back to its previous low.

6. What Is A Reversal Pattern?

A reversal pattern is a pattern that indicates that now coin is going to change its trend in the near future.

We can clearly see in the chart after that double low pattern price of eth goes up.

7. What Is A Double Top Pattern

In Double Top patter the price of the asset touches the new high and falls down with some price but in a short period, it again reaches that high again and falls down at the same top where it goes down earlier.

This is the example of the Double Top pattern which forms 2-3 times in very short time intervals.

8. What Is A Double Bottom Pattern?

The Double Bottom is the same as the Double Top but just in the opposite manner. In Double Top, it continuously reaches a high point whereas in Double Bottom it comes back to the same lower point again and pumps from there toward an upward direction.

In the above chart, you can see that it first goes down and moves into the upper direction for shot time and again came back to the same bottom point and after that, it jumps and goes into the uptrend.

9. Importance of Stop Level(STOPLOSS)

As we know more profit is better than less profit in the same way less loss is much better than more loss. If due to some regions market crash or goes deep down in that case if you set stop loss then you can save your loss. That's why strop loss is very important in every type of tread, whether it's short-term or long-term.

10. How To Set A Stoploss?

Different-Different peoples use different-different strategies to put stop loss or treading. Some peoples use different kinds of indicators to put stop loss as I not done much treading I didn't have more Ideas regarding the indicators but I can say that for sure that you can use the different patterns which we learn above to find your stop loss.

11. Conclusion

I have a tiny amount of knowledge regarding chart reading, but now I get a better Knowledge that how to read the chart and also how to identify the different patterns and accordingly take trading calls.

So this is all from my end for this week's homework task.

Note: All the images are taken from somewhere from the internet and the Screenshots of charts are taken from Coingeckowebsite.

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Thank you
@akkibadbboy
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