Peter L. Brandt is the CEO of Factor LLC, a global trading firm he founded in 1980 where he trades proprietary capital, forex, futures, fixed income and equity markets. He is respected and looked upon for his technical analysis approach and mindset.
Although Peter’s main trading mentor used fundamental analysis, he devised a trading strategy that was solely focused on technical analysis. It required making trades over considerably shorter terms. Although Brandt learned the value of money management from his mentor, he completely created his trading method on his own.
Chart analysis is merely a technique for locating areas where Brandt’s risk management strategy may be applied. His approach entails locating asymmetric trading opportunities—trades where the expected upside potential vastly outweighs the fundamental risk.
In terms of crypto trading, many traders across the globe rely on technical analysis for a short period, which explains the volatility of the sector. On the fundamental part, traders look at volumes entering and exiting major exchanges, the hash rate of the cryptocurrency and more. But many also argue that traditional fundamental analysis cannot be used to turn a profit in the crypto sector because there is none.
Critiques even argue that technical analysis for a coin can also defy traditional bear and bull chart patterns given the sector’s volatility. However, Peter Brandt pointed out an example in his recent tweet which inferred that technical analysis can indeed be applied in the crypto sector.
A Twitter user, @JLeader posted a Chiliz chart on a weekly time frame and pointed out that a “massive 11-month head and shoulders pattern is forming.” He also said that it was interesting that such a chart pattern is forming just before the world cup.
As per Chiliz’ website, “Chiliz is a currency option for blockchain-backed products & services geared towards mainstream consumers….Chiliz provides sports & entertainment entities with blockchain-based tools to help them engage & monetize their audiences.”
Peter retweeted @JLeader’s tweet and said that “Ppl (people) say that classical charting principles do not apply to cryptos. Yet, classical charting can be magic in certain cases. This may be one.”
His tweet reaffirms the fact that the theory of incompatibility of technical analysis for cryptocurrencies is not true. Many crypto traders would cheer for the fact that the author of famous technical analysis books like the “Diary of a Professional Commodity Trader” and “Lessons from 21 Weeks of Real Trading” is sharing their views.