The Art of Cryptowaves: Randomness & Order
Elements of chaos & elements of the order. Technical Analysis & Generative art.
In cryptocurrencies and in Cryptowaves there are elements of chaos and elements of order. If you look at a crypto chart, at the very first sight everything seems noisy, with no clear rules on how the price evolved over time. However, if you look closer and in detail, there are certain guidelines to interpret and/or that can help to predict the price.
Support and resistances are some indicators that are largely used by traders to understand the historical price action and as well to possibly predict where the price action will go next, or where liquidity might be. As an example, Daan Crypto Trades noticed the following
One could also see this approach of resistance and support, trending lines, wedges, etc, as a self-fulfilling prophecy: if everyone is interested in looking at certain price levels, the market will accordingly move towards what is expected by the majority.
What does this example have to do with Cryptowaves?
Cryptowaves are designed with some random parameters together with some guidelines.
Let me give you a couple of examples: colors and lines.
Colors
The color combinations are mainly generated by two approaches: randomness & modelling and meaning.
As we know from color theory, we appreciate certain combinations of colors instead of others. Which ones? Looking at colors represented in hue (h), saturation (s) and luminance (l), nice color combinations can be derived by taking complementary colors, which are colors at their opposite in the color wheel, or triadic colors that are colors at the edges of a triangle, or from many other combinations such as tetradic, split complementary, analogous, etc.
In our case, the first color of a combination is randomly generated, while the next ones are following the color theory guideline. A cryptowave with 3 colors has thus elements belonging to a specific triadic scheme, or to a split complementary one for example. This is aligned with the cryptocurrency world, where price seems to be random, but support and resistances are providing guidelines to traders.
Besides randomness & modelling, I wanted to provide meaning to color combinations as well. As explained in another story, Cryptos are life as they allowed people to build new companies, new projects, new applications and to evolve financial instruments and capabilities. Color palettes that are representing the 4 seasons, the 4 elements of life, the cycle of sunrise and sunset are thus used in order to represent the evolutionary nature of crypto, as well as the life that is provided. Each color palette has several color combinations belonging to the same element, e.g. the color palette for the summer theme can tap from different summer color combinations.
Lines
Another example of randomness & order is given by the shape of cryptowaves. Each wave could have had an unlimited combination of lines derived from Simple Moving Averages (SMA). However, Cryptowaves would have looked like a chaotic combination, difficult to be understood.
I chose instead to assign a limited number of moving average combinations, that should be interpreted as short, medium or long term views for a trader. A thinner wave represents short term decisions, actions and emotions by traders, retails or newbies. A thicker wave is instead not influenced too much by price volatility, but the focus is on the evolution over a long term period.
If you like Cryptowaves, please give a like and follow me here on Medium and on Twitter. The Art of Cryptowaves website is here and Twitter here.
Stay tuned.
Join Coinmonks Telegram Channel and Youtube Channel learn about crypto trading and investing
