$Steem / BTC Technical Pattern Analysis. Why I'm LONG NOW with Targets

Tuesday July 26, 2016 10:15 PM

Tl:dr Chart above tells you keys why I'm 50% LONG Steem bought at an average price around .0044 with a target at .0057-00625 -- lots of detailed analysis and trading strategy info below.

I'm just a few days on Steemit but for the last two months on my blog Cryptopatterns and on Twitter I've posted my crypto trades based on my pattern analysis in real time. My account is currently up 100% over the last 2 months. Note that I've never been 100% invested--more often I'm 25-50% invested as my trading strategy focuses on max returns with minimal risk.

I shared a great example of my trading approach yesterday on an ETC trade where I made 250% in one day. Of course I lose money on trades too, but not as much as I win, at least so far....

So let me put my ass on the line again with the above Steem chart that shows you some highlights of how I do technical analysis and enter/exit trades as a way to introduce myself to fellow Steem traders and investors. Notice I keep it SIMPLE -- not a ton of lines and channels -- just patterns I've discovered and easy to follow indicators. It's all about trying to read investor behavior -whether that's a computer or a person-- patterns can still guide your trades successfully.

STEEM TECHNICAL ANALYSIS AND TARGETS

The keys noted in the 4 hour chart above tells me that Steem is likely to go up quite a bit starting in the next 4-16 hours. A moderate to high probability target I'll be watching for is currently:

.00575 - .006250

I'll typically take up to half off a position as it closes in on a target, then assess where patterns say the next move should go. As I noted on the chart on this Steem trade, price can still go much lower in the next 8-12 hours without invalidating the pattern -- my indicators tell me there's a good chance it won't, so I went long 50%.

There's always a risk in any trade and on this one a real concern is a head and shoulders pattern on some time periods with a target around .0035. This is where TIME comes into play in my technical analysis. Steem has shown that pattern all day, all traders and bots have seen it and could have driven price further down to it's target-- but they didn't.

Probabilities are that the longer price doesn't drop below support at .0040, the less probable the head and shoulders down to 35 is. Because it's still a risk, I adjust my trade size and entries accordingly.

My Current Trade - Long Steem 50% of core position.

The balance in your trading account is absolutely the most important measure of your success, period. I have written many blog posts about position size so I'll just get to the keys on this particular trade here:

On every trade I establish a "core" investment fund -- so you'll see my trades stated as a % of my core position. In the case of Steem its a brand new crypto coin so relying too heavily on any technical analysis is extremely risky (sure you can read the patterns based on other currency but how can you fully trust patterns that are less than one month old??), Therefore, on this trade my position will remain small (10-25% of a more established currency or security), not matter how much of a "sure thing" the trade looks like.

My entries look like this:

**I made my first 25% purchase at about .0047 earlier today. I chased a bullish short term pattern, it didn't pay off but getting entries exactly is nearly impossible so I try to stick to my trading plan.

**I bought an additional 25% at around .004250 which brings me to 50% invested.

**I would add more if we get down to the 35 range if the patterns and indicators support it.

I do use stops on many trades but in this case it's a small intermediate term trade and I am only investing money I'm prepared to lose, so I look at it more like an option purchase -- so I'm prepared to buy and hold even if we see .0035 and possibly lower (another reason to slowly scale in trades), BUT, I don't just stay in trades blindly. If the patterns keep failing then I tell myself I've made a bad read and I'll look to exit the trade immediately or when the next key support price is broken.

So there you have it -- It's 10:30 PM as I type this and Steem is trading at just under .0042 which has me down about 10% on this trade so far. Patterns and Time says price should turn fairly soon -- we shall see....

That's the probabilities I base my trades on--of course there are no guarantees.or certainties in trading, and learning that is the key to success in my opinion.

Let me know any questions you have, I'll be happy to answer them -- I would love to see a huge trading community built here on #Steemit as I enjoy helping others avoid my many prior mistakes and I know there are great traders out there who can help me as well!

NOTE: NOTHING IN MY POSTS IS INTENDED TO BE TRADING ADVICE. Please do not base your trades on any information presented in the materials on this blog as it is for information and entertainment purposes only. You are 100% responsible for your own trading decisions.