This week we are demonstrating a volume based trading approach on KIN, but it can be adapted and used to trade other projects. The goal is to have a completely volume based trading approach. With smaller projects that can be all you need to predict the next move - in fact this strategy racked in +1130.8% in the past 6 months. Compared to KIN's 475% appreciation, the result of the strategy is stellar.
We'll be using OBV to gauge volume. On balance volume shows a total of the asset's trading volume and indicates whether this volume is flowing in or out. If you want to find projects that will be trending OBV is a great tool to see if there is potential. The swings on smaller market caps can be higher so adjust accordingly.
WILL POST POSITIONS BELOW
The goal of the strategy: - to beat holding KIN in that period - a dynamic strategy that has us in a position most of the time, exits when volume is outflowing - work with % changes in OBV rather than numbers as we want to be potentially able to use the strategy on another pair - simple to track and execute
The strategy: Initially we tried to catch the breakouts by involving other indicators too, but upon experimentation they proved to be unnecessary. This was the most fruitful set-up. 1 H chart - open position when: OBV is up by 2% in last 2 days - close position when: OBV is down by 3% in last day - no SL/TP - only market based conditions - do not open a position is both the open and s are correct at the same time. If you find it difficult to manually 1track those OBV changes they can be automatically tracked in CLEOone.
The results: This strategy brought +1130.8% in the past 6 months, beating holding KIN which would have you at +475%. Not only does the strategy win more positions than it loses (290 vs 273) it also wins more than it loses on average - +4.07% vs -2.95%. The average position was held for 2 hours with almost 4 positions open per day.
Test trading strategies on crypto, stocks, indices, forex with decades of 1-min data.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.