Ripple (XRPH19) Falling Wedge (Trade Opportunity Developing)I am seeing a trade opportunity developing for Ripple on BitMEX (XRPH19).
A falling wedge is now active and early signals are starting to show up.
Actively we are trading Litecoin (LTCH19 SHORT) successfully and recently we traded TRON (TRXH19) for massive fast profits (over 90% within 32 hours).
An opportunity is developing right now, a LONG trade... Let me share some of the signals:
Ripple (XRPH19) Early - Not yet confirmed - Reversal Signals:
Falling wedge pattern.
0.786 Fib. retracement support holding from last bullish wave.
Low bear volume (if this were to continue going down, we should be seeing higher bear volume).
MACD and RSI starting to curve.
These are really early signals that can be easily invalidated, this is not a trade.
If you want to see a full trade for Ripple (XRPH19) make sure to show your support hit LIKE.
If enough people are interested, I will share this trade for you with 100% ROE. You will have buy in, target, time frame, stop loss, capital allocation, profits potential and more.
Note: This is not a piece of trade advice.
Thanks a lot for reading.
Namaste.
Bitfinex
Wanchain (WANBTC) Bullish Engulfing (Learning)Here is one of the easiest to spot signals when it comes to candlestick reading, as well as a very accurate one.
Signals coming from the charts can get invalidated, meaning, you can have a signal that points to a change of trend and later the trend remains the same. For this reason, when trading we always use a stop loss.
Here we have what is called a "bullish engulfing" candlestick pattern. This happens when a bullish candle completely covers the bearish candle before it.
Marked light blue on the chart, you can see this pattern. The red/bearish candle, and the green/bullish candle which completely covers the bearish one before it.
On top of this pattern we also have a nice increase in volume (green volume bar below the last candlestick), as well as a break above EMA10.
(Looking for additional signals that support your main signal is always good as your analysis will have more strength).
Now, this is the daily time frame, so we have to wait for the daily candle to close before this signal is complete and valid.
If you trade based on this formation, your stop loss can be placed right below the low of the bullish candle.
Looking back on Wanchain (WANBTC) price action, you can see that volume has been increasing a lot lately, this is another signal that a move up is approaching.
Note: This is not a piece of trade advice. This information is shared for learning and entertainment purposes only.
All of my trades are clearly marked and contain buy in price range, targets, stop loss and additional details.
Hit LIKE if you enjoyed this post.
Namaste.
Using A Manual Stop Loss For Beginners @alanmasters (Learning)Hello my dear supporter, Alan Masters here and I want to share a few details about stop losses, the different types and how to better interpret them to maximize potential profits and reduce potential losses when trading with me.
Manual Stop Losses
Right now we are using what I call a "manual stop loss" and I will explain to you why.
Trading cryptocurrency isn't that easy, conventional markets are way easier to trade. Here the cycles are faster and the bots are more advanced, there are many ways that beginners can get lost in the simple actions that are: buy, sell and hold.
The purpose of a stop loss is to close a trade if the trend changes or is certain to change. Meaning, if we are aiming for a target to the upside and the price of an altcoin starts to go down, we close our trade when we confirm that the price will continue falling rather than bounce and go up. This confirmation normally happens where we analysts place our stop loss.
Now, it happens that the same place where a change of trend can be confirmed is also where support is found, in the example above. So imagine the price of the altcoin you are trading quickly going down and hitting support. A conventional stop loss would get activated and you lose your money, but with a manual stop loss, you don't close the trade unless the candle closes below the stop loss price. So in the case that the price is hit but quickly bounces, then there is no need to close the trade as the uptrend will be resumed.
I will share some charts to make it easier to understand why we use a manual stop loss.
First example:
Imagine your stop loss is set at $3579. BTCUSD goes down and hits this price, your trade is stopped and you lose money, but the price quickly bounces up.
With the manual stop loss, you would have to have the candle close below $3579, meaning at least $3578. And the candle on the chart above would look completely red/yellow (negative).
This manual stop loss requires more work as it needs to be checked manually, but this is something necessary when trading crypto as the markets are very volatile.
Other types of stop loss
The basic stop loss is the one where your trade gets closed as soon as a certain price level is hit. If you use this type of stop loss when trading cryptocurrency, I would suggest placing the stop loss at least 5-8% below the actual support.
One final strategy to take your stop loss effort even further, more advanced, is the full candle close below support.
This is a method that I highly recommend as well. For some people it isn't enough to close below support to confirm the trend change, they expect to see a full candle close below support before closing their trades. Taking it even further, you can look for big volume and any type of bearish candlestick or candlestick pattern for additional confirmation.
Piece of advice
We use a stop loss in order to avoid losing money in the case our trade goes wrong. The stop loss is not meant to indicate if the trade is active or not, or if I got it right or wrong... That's not the purpose, we are here to make money.
If you are trading and learning you can always adapt to the moment and make your own decisions based on what you see and not what is written. For example, if a stop loss is hit by 3 satoshis or few cents (in USD) but you notice that the price will move back up, you can keep your trade.
The purpose of the stop loss is to cut your loses but not to close a valid trade.
So take into consideration the market, the charts, signals and everything that is going on. You can also contact me and send me the PAIR you are looking at and I will be happy to help.
For beginners, you can simply follow our trade instructions and start creating your own strategy as you get used to these markets.
Thanks a lot for reading.
Namaste.
DigixDAO (DGD) Ascending Triangle Signal Bullish (Learning)Here is a very famous chart pattern called the "Ascending Triangle" and this is a bullish pattern.
When you see this signal, you can expect a bullish breakout. If the breakout to the upside happens, you can expect the target to hit the red dotted line.
If DGDBTC price closes below 0.0050 on the daily candle, this signal would be invalidated.
This post is for educational purposes only.
Chart patterns are only signals and can be invalidated and break the other way.
Always use a stop loss when trading as everything is possible at all times, market can change direction without notice.
Hit LIKE to show your support.
Thanks a lot for reading.
Namaste.
Cardano (ADAZ18) Long Again (BitMEX) - Tips 4 BeginnersI should have focused my energy on BitMEX earlier, this thing is a huuuge money maker... Easy money maker.
I am going LONG on ADAZ18 and would like to share some details with you if you want to trade as well.
Main support for me will be 940 satoshis on the daily time frame. When using leverage I want a liq. price that is below this level.
My main target is profits. For you, I trade with specific numbers and we aim to earn certain percentages but that is not how I trade myself.
My strategy is incredibly simple as I like simple... Simple is best.
Buy low... Later sell high. Meaning, it doesn't matter if a target is hit or not or how long it takes. What matters to me is coming out a winner and in good profits.
You can always close a trade that is either in profits or at a loss, regardless if you hit target or stop loss. Sometimes it is good to cut losses before hand, or collect profits right away.
If you are a beginner and trying to trade on BitMEX for profits, try starting small, with very low leverage on a low risk trade and allow time for it to develop.
Always make a habit of withdrawing and enjoying your profits, as well as leaving some behind to grow your capital and join new trades.
I hope you liked my advice.
Namaste.
Litecoin (LTCZ18) Bullish Hammer (Learning)Bullish Hammer
A hammer is a type of bullish reversal candlestick pattern, made up of just one candle, found in price charts of financial assets. The candle looks like a hammer, as it has a long lower wick and a short body at the top of the candlestick with little or no upper wick.
Please not that the candle needs to close for the signal to be valid.
You can trade a bullish hammer when they come up at the bottom of a trend and with good volume, as they can mean a trend reversal. You would use a stop loss which is the lowest point peak by the hammer candlestick wick.
I am trading LONG LTCZ18.
A drop and close below 0.00751 would invalidate this signal.
Sharing for learning. Hit LIKE!
Namaste.
Bitcoin Cash (BCHZ18) Bullish Engulfing (Learning)What is a Bullish Engulfing Pattern
A bullish engulfing pattern is a candlestick chart pattern that forms when a small black candlestick, showing a bearish trend, is followed the next day by a large white candlestick, showing a bullish trend, the body of which completely overlaps or engulfs the body of the previous day’s candlestick.
You can trade this signal with a tight stop loss at the low of the engulfing candle.
I am trading LONG on BCHZ18.
If price closes below 0.0332, this signal gets invalidated.
Sharing for learning. Hit LIKE!
Namaste.
The global trend is starting to change?How to understand when the global trend is starting to change?
The issue of trend reversal is very acute at the moment, because we are witnessing a rather long fall and one of the longest corrections now. And to be precise, this is the second biggest correction.
How to found out the moment has come and you need to urgently buy up everything so you do not cry you did not buy the Bitcoin for 6500, when it already costs 25k?
In fact, no one professional analyst or trader can say exactly the trend has reversed. There are always certain moments which just do not allow you to be 100% sure.
But we can give you some signs will help you understand it's time to make neat purchases:
1. Long fall. When you notice price decline continues for quite a long time, this is a sign the turn is getting closer and closer.
2. Falling volumes . If the volume falls noticeably in the long price decline, this is one of the strong signs an impulsive reversal is coming.
3. The price is on par or returns constantly to the same level. Certainly, the correction does not continue all the time, and if it can be seen the price returns to the level of the beginning of the rebound after local bounces, it means the “bottom” is somewhere nearby.
4. Slow motion. When the correction comes to an end, price movements slow down and overall volatility decreases dramatically.
5. Psychology of the environment. For example, when there was a big pump to $ 20,000 per bitcoin, all the people around were talking about cryptocurrency, everyone wanted to buy it, there was, so to say, an overload of the people industry. Then it was a sign it was time to close positions and wait for the falling. It is enough to interpret this observation.
These are the data we have noticed and collected to you understand the market could turn around. Surely, there are a lot of moments, but we gave you the most common and basic ones.
Thank you for attention! Let profit come to your home
How it paints - Replay mode on ETH/USD - Heffae Clouds 3XTFIt's difficult to see from a chart that does not move how the clouds work, so I made this short video on Replay Mode to demonstrate.
Watch how the price reacts to the cloud tops, bottoms, intracloud SnR lines, and the RealTime additive (thin green line).
Study: Why you should stop trading BTCUSDHello all and welcome to my analysis of trading patterns in crypto markets!
Before we begin, there are several key assumptions we must establish:
The reference data is based on trading prices and volumes on Bitfinex. This is because I believe that Bitfinex is the leading exchange in the cryptocurrency market due to its popularity, despite higher recent BTCUSD volumes on Binance.
Only USD-based pairs are examined
The index is a dollar-volume weighted aggregate of margin-tradeable alt coins on Bitfinex, excluding BTCUSD
The correlation and beta calculations are on a 14-period basis, which are benchmarked against BTCUSD
Given limitations with the data, the index is examined only on a range from October. An second index, consisting of only ETHUSD and LTCUSD will be provided to show the longer timespan
In this snapshot, I have split the frame into three timeframes (A, B, C), which highlight a changing market dynamic over time.
Timespan A captures the peak of bitcoin's 2017 hype. The lowest correlation point is -0.65 which was accompanied by a beta of -1.65, while the highest correlation was 0.80 with an index beta of 3.44. During this span, a relatively volatile correlation (refer to the standard deviation of correlation oscillator) between the altcoin index and BTCUSD can be examined, with similar volatility patterns in the beta. The interesting component here is that, during the price rise, alts would follow BTCUSD when BTCUSD was rising, but experience inflows of money from BTCUSD when the latter was falling. As such, the market mentality was bullish - the money would flow from BTCUSD to alts and then back around. By examining the index beta over this period, you can see how alts outperformed BTCUSD when times were good and when times were bad.
Timespan B begins to paint a different picture, where the volatility in correlation and beta measurements is far less drastic. Over this span, the lowest correlation was 0.28, showing that directional movement between the index of altcoins and BTCUSD remained positive, even when weak. It is important to note the longer duration of high correlations during this period, which were accompanied by similar movements in beta.
Timespan C is where we currently are and, in my opinion, this is a very interesting setting in the market. As the chart shows, the lowest correlation was 0.50, while beta almost consistently remained above 1. The standard deviation of correlation had been only trending downwards from Timespan A , which is reflected in the relatively consistent correlation measurements over the period. The conclusion to be made is that altcoins, in aggregate, have become strongly correlated to BTCUSD, while a beta above 1 indicates higher performance in alts than BTCUSD.
TL;DR: chart BTCUSD and trade altcoins based on BTCUSD momentum. As the statistics show, the market mentality has shifted away from moving money from one crypto to another, but rather buying/selling alts and BTCUSD simultaneously.
Furthermore, we can examine a longer timeframe in the chart below:
In this chart, the correlation and beta, as well as the standard deviation of correlation, are based on a dollar weighted aggregate of ETHUSD and LTCUSD, which were the longest standing altcoins on Bitfinex. The narrative described above remains the same, where the correlations have become far stronger in recent times compared to their historical trends, while the beta has become stronger over time, gaining more ground above a measure of 1 during the high correlation periods.
The final point is an examination of dollar volume in BTCUSD compared against altcoin dollar volume:
As can be seen from the chart, the dollar volume in BTCUSD has been losing ground to the dollar volume in USD-based alt pairs (on Bitfinex)
BTC - Gann Fan Strategy - Remedium for anxietyHi Guys.
As market is still unstable we would like to share with you interesting and promising strategy which can help you to get calmer.
It presents in a elegant way current trend and tells us when to buy and sell or when we have to just wait for the final verdict.
This indicator is notable unique because it draws diagonal support and resistance levels at different angles. At first sight you might recognize the indicator because it’s a colorful indicator much like the Fibonacci Channel indicator.
One of the main reasons why Gann fan angles are superior to the horizontal support and resistance levels is that financial markets are geometric in their movements. This means that if you can spot a pattern or or any other geometric shape in a chart, then there is a high probability you can spot them at the Gann fan angles.
Gann fan trading strategy can be applied to all markets because according to the Gann theory, financial markets move as a result of human behavior which makes them cyclical in nature.
We have special Gann fan angles and more specifically Gann came up with 9 different angles.
The most important angle is the 45-degree angle or the 1/1 line. For every Gann angle, there is a line that is derived from that angle. We can distinguish 4 different Gann angles above the 45-degree angle and 4 other Gann angles below, as follows:
1/8
1/4
1/3
1/2
1/1 – 45 degree
2/1
3/1
4/1
8/1
According to Gann theory, there are special angles that you can draw on a chart that will give you a good indicator of what price is going to do in the future. All of Gann’s techniques require equal time and price intervals, in other words, a rise of a 1/1 would imply a 45-degree angle.
It may sound a bit ambiguous but it is easier that it sounds. In the comment section we will provide you step-by-step explanation how to proceed your Gann Fan Stratefy of any asset you want. We will base on latest BTC 3.22% chart.
So let's go!
How to ladder buy BTC and other AltsHello everyone,
As I'm writing this, the market is currently in a downtrend, and there are many people trying to predict where the price might go. This is a very difficult thing to do and most end up completely wrong. In this idea, I'm going to share with you guys my method to buying during a drop in the market.
==================================
What I've highlighted and drawn:
1) The red box, double top, drop zone, which we will refer to as our initial high.
2)Predicted support zones with green boxes
3) Weak support area in orange.
4) Areas of interest circled in yellow.
5) Buys that are captioned.
I will now explain each of these, and how I came up with them.
==================================
First off, you will notice there are 0 indicators, no RSI, no MACD, and no moving averages, so how can we figure out areas where we might be able to buy anything?
1) The Red Box area is obvious to most, there is a double top with sell off.When it goes below the orange support, this confirms the double top. (Some use Elliot waves, Fib retracements and other methods to help with confirmation, I simply see red and a sale below to confirm this.)
2) The green boxes are predicted and placed based on previous strong green candles in the previous bull run were. (A word of caution, we don't automatically buy here, read everything first.)
3) Weaker support zone is tougher to identify and I personally call it this because in the event of a sale from the same top zone,(Red box area) this is the riskiest position to buy.
4) So with that out of the way, we can now move onto why these areas are circled in yellow:
A) We see either an engulfing green candle, a green candle with a long wick or prices moving up multiple days in a row.
B) These candle closings are what I use as confirmation of a support in this area.
5) Now for the juicy part, the buys. I'm going to give this one it's own sections because it's more involved then any other section.
==================================
Buying:
1) I picked 3 buy prices based on the zone we were in. None of these are the best price. Just a disclaimer, you will RARELY EVER GET THE LOWEST PRICE EVER. So first off, get the idea of lowest price out of your head.
2) Got that lowest price idea out of your head? No? Go back to number 1......
Got that idea out now? Good. So how do I come up with this price? After the initial strong green candle closes, we wait for the close of the next days candle and then place a buy order in the body of the 2nd closing candle. We don't use wicks because there is a far lesser chance that we will see those prices.
Example on buy#1:
Strong candle close = about 8400 to 9400
Next day close = 8900 to 9900
Based on this = 9200 is within the body.
Now that you know how to find the areas of interest (yellow circles), areas of predicted support, (Green boxes), and where to place the buy (Body of candles), you can buy right? Well not yet. You still need to know how much you should buy to ladder responsibly.
==================================
Final Step: The buying!
Okay after I established my areas, where I would buy after confirmations and such, how do I know how much to buy? There is no secret here, just rules you come up with. My method is a formula:
First, I figure out how much capital I have to invest in this market. I'm going to use $10,000.00 as an example:
Next, I divide the top price by my potential buy price (not the one I have yet, but what I will be placing my buy order for.) and subtract 1.
Finally, I take that number and multiply the amount of money I'm willing to invest in this market.
The whole formula looks like this:
*Current Investment Capital = Your buy amount.
For consecutive buys, use the remaining capital.
==================================
Going to place the example of buys in a followup post, I hit the character limit!
BTCUSD 2hrs COINBASE : MAY BULLTRAPBitcoin / Dollar 2hrs GDAX chart is looking in to famous upcoming 2018 Spring/start of summer BULLTRAP.
MY PLAN and brainstorming at the same time is:
1. First of all always scale out at least a bit of your positions under the traders rule: SELL IN MAY AND WALK AWAY. Most of the times happen and this 2018 summer will be no different (my personal deadline is JULY 21st).
2. Though before that I still expect BTC stay above 8K hopefully. Dip down to 7.8K is still OK. But dip down to 7.2K and lower will be:
a) People would get scared remembering 6k and 6.5k dip;
b) or BTC would gain so much needed momentum upwards to break 10K voodoo zone.
3. My bet stays at this moment with b). I feel bullish until the end of May.
4. I hope Bulls wont be trapped in the zone and break vital 10K line soon. Targets 10.8K-14K before JULY 21st.
5. Take profits. Enjoy holidays.
6. Buy the dips over the summer. In 3K-5.7K zone if lucky
7. Watching it growing slowly in 2018 Autumn / 2019. Exploding again in 2020.
The bottom line is IT IS NOT FINANCIAL ADVICE.
Just 1 possible path of hundreds to choose.
And OFC: When facts change. I change my mind.
Market Overview | Sideways ActionHey traders, here's an update on the $BTC market. Enjoy ;)
Remember the 1-2-3 Strategy:
And if you forgot what cyclical trades are, watch this one:
BTC - WEIS WAVES - TRUTHFUL INDICATORHi Guys!
Today we want to share with you knowledge with regard awesome indicator which is Weis Wave.
We all can see that we have up and down trends. Everything moves in waves' manner. There are plenty of buying and selling waves. But how to identify trend change and buy low and sell high? It's not that easy but with Weis Wave indicator it will become clearer.
Wave charts were first created by Richard D. Wyckoff. In his famous course on stock market technique, he instructed students to “think in waves.” Wave analysis was an integral part of his trading method. The Weis Wave is an adaptation of Wyckoff’s method that handles today’s volatile markets. It works in all time periods and can be applied to the futures, forex, stock, commodity markets and of course cryptocurrencies. You will be amazed at how well the Weis Wave identifies turning points.
So we prepared description of this indicator basing on up-to-date BTCUSD 1H chart.
It might be useful in terms of determining BTC price in the very near future.
So let's get down to business.
Let's assume we start from point A.
We can see we start from the price of around 8860 USD.
We finish at point B. We have there green candels (demand) increasing and at the same time red candels decreasing which says we have no supply. This is perfect situation of the price increase. We have smaller amounf of commodity and at the same time our demand grows.
Moving further number 3 followed by point B, we have small green candle stick. It is much smaller than preceding green waves. It means our demand is spent. Moving further our red sticks (point 4) are getting bigger which means supply is getting bigger. As a result price drops.
At point number 5 we have again red candle stick which is smaller than than preceding red waves which means supply is lower and we can expect price to increase. It is confirmed by the wave made from green candels (point number 6). Price goes up.
At point number 7 we have again red candles' wave and again price drop-down. More interesting is that when we can expect trend reversal and when we should establish long trade.
We can see this at point number 8. Small red candle sticks are followed by green waves and those red sticks are significantly smaller than preceding red waves. Green waves become bigger and price increases.
That's it! Isn't it awesome?
That's the first educational post regarding Weis Waves but there will be more. We are very excited about that!
We are sorry for the language which is some parts is repetetive and a bit chaldish but we wanted to be pricise and clear it as simple as possible.
If you like it don't forget to like it, comment and follow us!
Thank you for being here.
HUGS!
Your WBM Team.
Market Overview | Should We Be Opening Long Trades?Hey traders, here's an update on the BTC market. Enjoy ;)
Remember the 1-2-3 strategy:
And if you forgot what cyclical trades are, watch this one:
Market Overview | Cyclical Trades to the DownsideHey traders, here's my educational take on the crypto market. Enjoy ;)
Remember the 1-2-3 strategy:
And if you forgot what cyclical trades are, watch this one:
The Double Bottom Reversal is a bullish reversal pattern!The Double Bottom Reversal is a bullish reversal pattern typically found on bar charts, line charts, and candlestick charts. As its name implies, the pattern is made up of two consecutive troughs that are roughly equal, with a moderate peak in-between.
Although there can be variations, the classic Double Bottom Reversal usually marks an intermediate or long-term change in trend. Many potential Double Bottom Reversals can form along the way down, but until key resistance is broken, a reversal cannot be confirmed. To help clarify, we will look at the key points in the formation and then walk through an example.
Prior Trend: With any reversal pattern, there must be an existing trend to reverse. In the case of the Double Bottom Reversal, a significant downtrend of several months should be in place.
First Trough: The first trough should mark the lowest point of the current trend. As such, the first trough is fairly normal in appearance and the downtrend remains firmly in place.
Peak: After the first trough, an advance takes place that typically ranges from 10 to 20%. Volume on the advance from the first trough is usually inconsequential, but an increase could signal early accumulation. The high of the peak is sometimes rounded or drawn out a bit from the hesitation to go back down. This hesitation indicates that demand is increasing, but still not strong enough for a breakout.
Second Trough: The decline off of the reaction high usually occurs with low volume and meets support from the previous low. Support from the previous low should be expected. Even after establishing support, only the possibility of a Double Bottom Reversal exists, and it still needs to be confirmed. The time period between troughs can vary from a few weeks to many months, with the norm being 1-3 months. While exact troughs are preferable, there is some room to maneuver and usually, a trough within 3% of the previous is considered valid.
Advance from Trough: Volume is more important for the Double Bottom Reversal than the double top . There should clear evidence that volume and buying pressure are accelerating during the advance off of the second trough. An accelerated ascent, perhaps marked with a gap or two, also indicates a potential change in sentiment.
Resistance Break: Even after trading up to resistance, the double top and trend reversal are still not complete. Breaking resistance from the highest point between the troughs completes the Double Bottom Reversal. This too should occur with an increase in volume and/or an accelerated ascent.
Resistance Turned Support: Broken resistance becomes potential support and there is sometimes a test of this newfound support level with the first correction. Such a test can offer a second chance to close a short position or initiate a long.
Price Target: The distance from the resistance breakout to trough lows can be added on top of the resistance break to estimate a target. This would imply that the bigger the formation is, the larger the potential advance.
It is important to remember that the Double Bottom Reversal is an intermediate to long-term reversal pattern that will not form in a few days. Even though formation in a few weeks is possible, it is preferable to have at least 4 weeks between lows. Bottoms usually take longer than tops to form and patience can often be a virtue. Give the pattern time to develop and look for the proper clues. The advance off of the first trough should be 10-20%. The second trough should form a low within 3% of the previous low and volume on the ensuing advance should increase. Volume indicators such as Chaikin Money Flow , OBV and Accumulation/Distribution can be used to look for signs of buying pressure. Just as with the double top , it is paramount to wait for the resistance breakout. The formation is not complete until the previous reaction high is taken out.
Bitcoin big Picture (2) UpdateNew trend line coming into view using Bollinger Bands . Also I've added some extra colour to indicate double arrows pointing down in blue and those up in pink. Hard to see but the only way I could show big picture.
HOW TO TRADE ETHEREUMEthereum Trading Strategy
All we need for this trading strategy is two technical indicators:
The MACD – This is a momentum indicator that can help us spot a trend.
The MFI or the Money Flow Index an overlooked but critical technical indicator that measures the money flow into or out of a cryptocurrency.
The MACD is one of the most common indicators used by traders around the world in a variety of different markets to spot trades before they happen.
The MFI indicator is based on price action and it incorporates Volume in its calculation, which is quite similar to other oscillators. In other words, we can use the MFI indicator to measure buying and selling pressure.
We can use the MFI indicator to trigger entries and to take profits.
The easiest way to interpret the MFI indicator is that a reading above the 50 level represents an inflow of money into the cryptocurrency, while a reading below the 50 level represents an outflow of funds from the cryptocurrency.
The other critical MFI thresholds are 20 and 80. An MFI reading of 20 is considered bullish and oversold while a reading above the 80 level is considered bearish and overbought.
Step #1: Wait until the Money Flow Index drop below the 20 level
The first rule is that you always want to wait for the Money Flow Index to be in oversold territory. In other words, we need to have an MFI reading below the 20 level.
An extreme MFI reading below 20 suggests that there is very heavy money outflow from Ethereum. As history has repeatedly shown, this information can be used as a contrarian indicator.
The MFI indicator is not a standalone indicator. There are plenty of good cryptocurrencies that have high MFI reading, and most bad ones have low MFI reading.
So, in order to use the MFI indicator, we need to check it against other technical indicators which are the reason why we also use the MACD indicator.
Step #2: Wait for MACD histogram to break above the zero level
The second rule is to wait for the MACD histogram to turn positive. This is a confirmation that the bullish momentum is starting to build up. Now, we have two rules in place, but these are still not enough to trigger an entry.
Indicator-based strategies are very unpredictable which is the reason why we’ve added another confirmation signal before to enter and buy Ethereum.
Now, we’re going to lay down a straightforward entry technique for Ethereum trading system.
Step #3: After MACD turned positive, Buy after MFI also breaks above the 50 level.
As an extra measure of caution, we also like to wait for the MFI indicator to break above the 50 level before to buy Ethereum.
A reading above the 50 level represents an inflow of money into Ethereum which is the moment when smart money is stepping into the market. We want to trade alongside smart money to really make a profit trading the cryptocurrency market.
Step #4: Place Protective Stop Loss below the Previous Swing low
In order to minimize our potential loss we want to place our protective stop loss very close to the market price but at the same time at a price where it should really invalidate our trade signal.
For the Ethereum strategy, the ideal place to hide the stop loss is just below previous swing low. You can always add a buffer to protect yourself in case of a false breakout.
Step #5: Take Profits when the MFI enters Overbought territory or above the 80 level
When it comes to our Ethereum take profit trading strategy we want to cash some profits at the first sign that the market is about to turn against us. Otherwise, we risk given back some of our hard earned gains.
The first indication that the market is about to turn is when the Money Flow Index enters into overbought territory. In other words, when the MFI breaks above 80 levels, we take profits.
Use the same rules for a SELL trade – but in reverse.
Ethereum has fundamental advantages that hopefully will help Ethereum price suppress Bitcoin in the coming years.
4 Years of BTC and herd mentality in one chartHey guys, as you've seen on my previous forecasts on BTC and XRP, I've started to accumulate and increase my holdings. Besides the technicals, my bias is getting even more long biased due to the massive pessimism around inexperienced traders and overall media coverage. As you can see on the chart above, this is not the first time the world has witnessed such a huge drop on BTC. Back in 2014, when the total crypto market cap has dropped below 5 billion USD due to a massive sell off of -87%, the web was full of articles saying that Bitcoin is about to collapse. That it will end.During this phase, we've also witnessed the MtGox affair and the start of some regulatory talk. Some university professors and asset managers begun to throw out predictions that BTC will hit $10.
Once price has started to recover, you've suddenly heard nothing more from these people. The sentiment has been switched to "keep our mouths shut" till BTC slowly gained bullish momentum again. What happened then? The very same newspapers and magazines started to write articles that BTC is now "hip" again and it might become a big thing in the future. As soon as price started to really rocket, the very same procedure has started again. Jamie Dimon/CEO of JPMorgan, marketwatch.com, CNBC journalists and many others listed thousands of reasons why Bitcoin is bad, risky, a fraud and of course why we all should stay away from it. Guess what happened when the price started to drop again in January? Right. The very same thing. There is no "this time it's different". This market is still in its infancy and yes, there are other coins that might become the crypto #1 but no one knows when it will happen and we shouldn't actually care about, because for now we clearly see a heavy BTC dependance on other alts - despite the diminishing BTC dominance.
Long story short - I think it's extremely important to never, really never fall for any catching armageddon crypto headline out there. I am actually using all this as an contrarian indicator, meaning that a peak in both, heavy optimism and pessimism regarding cryptos should be a warning sign. People just went crazy in France a week ago or so, because some stores have been offering Nutella and diapers for a 70% discount. This thing has escalated so quickly that they've had to call the police. On the other hand, when people are been offering to increase their crypto holdings to buy back at a heavily discounted price of more than 70% , people are scared to death and even sell(!!!) their holdings with a massive loss. I mean..that's just insane.
It's not about having the most accurate entry or exit. Think of Michael Burry (The Big Short) or other investment funds who act during or prior to such a crisis,bubble,healthy correction (call it whatever you want). They rarely squeeze a trade out from the very bottom to the absolute top. Sure, they're doing their best to do so - but in the end it's about the final result. And speaking of this, it simply doesn't matter that much if you've bought in at $6k or $7k. Hell, let BTC even drop to 5k or 4k. That would be even better, as we can buy at much cheaper levels. And once BTC and alts start to gain bullish momentum again, you'll hear the exact same words, you'll read the exact same headlines on the very same magazines and newspapers. And yes, there will be again regulatory talk going on, people spreading rumours, maybe some bans, etc. It just doesn't matter in the mid to long run.
I've seriously read a comment below a tweet of Kim DotCom who advised people to buy BTC on the 5th of August 2016 with the words "Buy Bitcoin while cheap. Like right now. Trust me". You don't believe what an insane amount of hate comments he received and many were just like "mhmm alright". These peeps have probably the very same mentality to those who are laughing at others that say, BTC and alts with a proven concept will have another insane bull run in the near future.
Don't be a sheep. Don't panic. Be patient
ETHUSD 15m Big 3 TradesThese are the Big 3 rules.
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