Extreme Contrast Analysis

This is a video from an unreleased course which goes over the primary principle I use in studying the crypto markets and the crypto charts. Crypto - like life - is 90% mental. This seems to be the key and deciding factor for me winning or losing in pretty much anything I do. Crypto is no different because while crypto is volatile, it really is just a bunch of humans and their emotions behind the charts. A composed mental approach to these markets is therefore the primary focus for me.

Extreme contrast analysis. This is not going to be a terribly long video, it'll be pretty short, simplistic to the point. But this is probably one of the most important videos

in the entire course. This underlines everything, everything we're even going to look at, from a technical perspective, on chain metrics, patterns, momentum oscillators, it all revolves around this principle, because when we're studying the data, and we're utilizing the tools in the arsenal, underlining all of it is this principle.

And this principle, it applies to life, not just crypto. It applies to so many different things. And it's something that my father taught me. And I want to actually bring up the charts to kind of help visualize how simple of a strategy this is. So extreme contrast analysis, I remember my dad have originally brought this up to me. And to me, it sounded like a complicated equation of some sort that he's about to describe to me. And it's something he just came up with. My dad is very creative in that regard. He just comes up with with names for different approaches, or he comes up with sayings for different approaches to life in general. So this, this one thing is called extreme contrast analysis.

And I have a Bitcoin chart because a Bitcoin chart actually visualizes exactly what it is. So I'll give an example of how my dad would use this to help me strategize. Actually, it was in a negotiation in business where we actually apply this. And there's many different areas and conversations I've had with my father, where we discussed this, but in negotiations, and in one certain situation, I can remember, extreme contrast analysis came into play. And it really goes like this, I had a decision to make, I was in the middle of negotiations.

And in replying in emails, in negotiations, it can be dicey, you really have to check your words, you really have to think about what you're going to put out there, you have to think about so many different aspects of that the mentality behind it, the numbers behind it, you have to calculate all of these different moving parts. And then you have to really calculate well, how is this going to impact my life, depending on how this ends up if I lose this deal, if I get this deal, and there's upsides and downsides, and that alone is a lot like crypto, we don't know exactly what's going to happen next. But we do know we have decisions to make, we have decisions to make at any given time on this chart.

And extreme contrast analysis puts you at the very center. If you can visualize a Bitcoin chart, it puts you kind of in the middle, when there's this time of just just kind of peace, sideways trading consolidation, everybody's wondering, are we going up? Or are we going down, but we have a decision to make extreme contrasts analysis basically evaluates the total upside scenario if it played out, and the total downside scenario if it played out, and then it allows you to weigh your options. And then it allows you to just best make your decision. extreme contrast analysis is a visualization tool. And it doesn't help you predict what's going to happen next, in my case, making negotiations, but it does help you make a list of best case scenarios. This is the absolute extreme best scenario that could possibly happen if everything goes right with what my offer is in this negotiation.

And then on the extreme contrast scenario, on the extreme downside, these are the worst things that could possibly happen. What's the worst that could possibly happen? For that negotiation, it would be completely lose the deal, maybe somehow lose some money there, right? So we evaluate and we just take the the two extremes, the extreme upside, and the extreme downside, and we visualize those things. And then we are able to make clear decisions. And so here we are with Bitcoin on the Bitcoin charts. And it's kind of like the same exact thing. It's extreme contrast analysis. It is so monumental, it is so important. At any given time on these charts, it does not matter if you're in a bull market high. It does not matter if you're in a bear market low at any given time. We use this method. So what that looks like is at any given time, with crypto, whatever crypto you are in, if we're in a bull market high, writing the hype, all the fear of missing out the greed that is there. Or if we're in a bear market low and there's fear, you have to ask the extreme extreme Question number one, extreme to the downside. What's the worst that could happen? Crypto fails, crypto goes to zero, you lose it all, it is extreme. It is extreme to the downside. And then we ask the question to the upside, well to the upside, and again, doesn't matter if it's a bear market low, if it's a bull market high to the upside at the same time, you're you're, you're knowingly acknowledging that we could go to zero at the same time, we acknowledge that that crypto could actually just blast off that Bitcoin could go to a million dollars in just this extreme, dis extreme world of parabolic gains, Bitcoin, and crypto just takes off. So in that moment, at any given time, we are evaluating both extremes. Crypto just takes off whether you're in a bear market or bull market, and it keeps going. And at the same time, you're evaluating Well, what if it all fails, because when you have those two scenarios, and you have that extreme contrast analysis, in the forefront of your mind, you're making wise decisions. And that is all this is about.

So when we have that as a principle layer of everything that we're doing, and we're using that as the principal layer, to all of the tools, because now we start bringing in the tools, we start bringing in the data, we start getting an idea of what maybe is next, not predicting, but starting to anticipate certain scenarios, things really start coming together. But it is way deeper than just using the tools that we have at hand. Using on chain metrics, and seeing trends and using the consistency of trends, it really comes down to at the end of the day decisions you and I have to make decisions in an extremely volatile environment is cryptocurrency and extremely risky environments, at any given time. Stop trying to predict what's going to happen.

Next, use visualization tools, in this case, the extreme contrast analysis, I have to say, intertwined in that lesson intertwined in this principle is this lesson that my dad taught me when I was younger, that apply too many you may have heard me explain this before it applied to baseball, it applied to me trying to learn to drive the saying that my dad told me was expect nothing. Anticipate everything. So when you're driving, you're you're not expecting that the car is going to just do what they're supposed to be doing.

But you're anticipating that they might do something wrong, and you need to react. In baseball, you're out in the field, you're anticipating all these different scenarios that could play out so that you're ready and you're prepared in the moment for all of those scenarios. And then in crypto, the same is true. Expect nothing. Anticipate everything. And it goes against this premise of predictions and predictions are very popular in crypto. They're very popular in trading. But statistically, even the most famous analysts in the world historically, they just they're 5050 Nobody knows. So so put aside predicting start using visualization tools, extreme contrast analysis, shout out to my father. Expect nothing anticipate everything. This is foundational to all of the tools that we're going to learn throughout this course.