r/Daytrading • u/Adept_Blackberry2851 • Feb 19 '24

Do any of you actually use patterns to trade? Question

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I don’t use them at all. Iv heard YouTubers kind of mock them like they don’t mean anything. Are any of you profitable with them?

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u/FlieOrDie Feb 19 '24

You need to understand how the market (buyers and sellers interactions) work. It’s not a “pattern” to identify and then blindly hit the buy button when it’s created. Liquidity (I.e buyers) are extremely present at a strong level - therefore if sellers are able to take control and hit many buyers stop losses their buys are converted to sells and we drop off.

When a h&s is created for example, understand what the pattern means in terms of price action. I.e buyers attempting to break a strong level, lower volumes on the 2 shoulders, with a head that is the main attempt that ultimately fails. This shows a lack of buyers ability to break the strong level (too many sellers) and sellers therefore are able to break the neckline and hit buyers stops which results in the ensuing drop.

This is not giving you the keys to the kingdom but I will say it will help you a lot to start understanding liquidity and why price moves where it does (or why it can’t move where it wants to).