What IS Bitcoin?! An Explanation of Why Bitcoin has Value!In this video I explain what is Bitcoin fundamentally and why does it have value to investors.
If you have any questions then please comment below.
I hope this video has been informative.
Btc-bitcoin
Education - How does a bubble develop and what are the signs?Preface:
This learning content or information is merely my experience, or are those techniques that I use or find useful.
The beauty of technical analysis is that an analysis or forecast can be made using many different approaches.
These differ in effort, approach, tools and technical approaches.
However, I think one thing is important:
Keep the chart as simple as possible, try to see what is obvious and work with as few tools as possible but as many as necessary.
If you base your analysis on what seems obvious, it is likely that many other traders will also see it. This in turn would support a movement in the predicted direction.
= Self-fulfilling prophecy
-> Examples: Moving averages, Fibonacci retracements, Simple formations etc....
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Remark:
This is supposed to be a small help to identify signs of a bubble formation, I must absolutely note that a lot of experience and knowledge is necessary here, which I can not convey in a hurry, as this would definitely go beyond the scope.
Just try to analyze the BTC rise of 2017 with the help of these signs, or even the current rise.
What is a bubble ?
A bubble is usually easy to recognize in retrospect, a lot of green long candles, few red candles, until usually a high point. Then lots of big and long red candles and few green :)
But how do I recognize a bubble while it is forming?
Important:
Please read through the wave age tutorial I wrote beforehand, this understanding is needed to continue here.
If a trend does not consolidate sufficiently, but on the contrary shows shorter and shorter consolidations, rises faster and faster and ideally is still fueled by media interest, then these are the first signs of a bubble. (See bar in the chart)
Within a trend, the price must consolidate sufficiently after a rise (to go into this in more detail would go beyond the scope).
If now the trend in the period under review over the zenith, so after eg 6 waves, a new high and then further waves, with steeper and steeper price increases, so a bubble is to be assumed.
The price MUST consolidate sufficiently to be sustainable.
In the weekly, we can see that the price is moving further and further away from the standard SMAs (20,50,200) until it reaches an unnatural distance, which also indicates that the market may be in a bubble.
As soon as such signs appear, it is important to set very tight stops, as it can come to an abrupt end.
Summary:
-Ever steeper rises
-Ever shorter consolidations
-Distance to SMAs is becoming uncharacteristic of the market
Bonus: Media coverage of the asset
Annotation:
Since the weekly chart is shown here, it is not possible to see how the price reversal occurred. A SKS formed in the H4 , this was the beginning of the end of the steep rise.
Also today, we have the same signs as 2017, to note was the very strong and violent reaction , this does not mean that the course will now immediately sink it can go before still on 60.000 , 70.000 or even more high, from my point of view, the current consolidations were not sufficient, I have this in mind when placing a stop
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If I like this kind of tutorial, so leave me a like there and follow me. If there is enough interest I will post more tutorials like this in the future
Best regards and good luck
DCT Trading
Education - What are divergences and how do I use them?
What are divergences and how do I use them in trading?
A divergence usually shows the trader that the price is moving in the opposite direction to the indicator (or vice versa).
To find a possible divergence in the price you can use various indicators (MACD, Stochastic, Momentum, etc.)
I will limit myself to the Momentum indicator, because I use it myself in my trading.
What does a divergence say?
As already mentioned, the indicator shows me a contrary movement to the price, related to the momentum indicator this means for example:
The price rises and forms a new high, but the momentum indicator forms a lower high in the indicator itself compared to the previous PRICE HIGH
How do I use a divergence?
A divergence can be used in many ways if you know what to do with the information gained. In my opinion, this also depends on the chosen indicator, at least in terms of the information value I get from the divergence.
If one is able to identify a divergence correctly, one receives a kind of "warning", in my opinion a divergence by itself does not represent an action signal, but it warns me that in the case of the momentum indicator it comes to a trend slowdown although the price continues to rise.
What is to be paid attention to here?
-> As mentioned, a divergence by itself is in my opinion NOT a TREND SIGNAL, but a warning or information around which I can now supplement or adjust my trading.
-> Very important, there are two ways that one "bends" the divergence to right once the setting of the indicator is crucial, since each trader uses other settings, it is important not to change these in search of a divergence so that one is formed.
->Furthermore, it is important to consider the time unit under consideration, a divergence occurring in H1 is much less meaningful than one in D1.
Summary:
Divergences are a possibility to add important information to one's trading at an early stage in order to forecast possible price changes that have not yet occurred.
They do not represent action signals on their own.
BTCUSD Bitcoin analysis and educational lessonThe educational lesson is an illustrative diagram drawn regularly that shows most of the movements between the date of January 4th to today in a classic, easy-to-understand way, linking the movement with the next movement
Important for any new futures traders!Going to keep this simple here.
The price of bitcoin has sky rocketed these past few months. During the spring & summer time a few hundred dollar move in price would be crucial!
Now the price of BTC is lingering around 50,000. Those small movements that where only a few hundred dollars are now thousands.
👉 My point here is that anyone using anything above 5x Leverage is critically risking there portfolio.
💀These shake outs & wicks are future traders death call.
📈 Lets took a look just recently when BTC had closed above its critical resistance level at around 49,400.
Many individuals had purchased or over leveraged thinking price will move up after confirmation. (Bull trap)
On average the price shifted down about 3%. Anyone more then 20x leverage would have for sure gotten a margin call or suffered liquidation.
👇👇👇
My point is price is too high for individuals to think that over leveraging will yield them higher returns.
Trade futures with risk management and the correct way.
The reasons exchanges offer up to 100x leverage is so they can make money.
CRYPTO TRADING TIPSI made this post so that myself, along with other traders trying to step into the Crypto world can have a better idea and some insight to what lies ahead.
If you can drop some your thoughts on tokens, the Alt coins and also a few sites like Defi, Coin Gecko and 1inch, it would be appreciated. Trading the lesser known coins obviously are obviously high risk, but they also present opportunity for high reward.
More importantly, outside of the crazy news events that spike crypto sometimes, how does technical analysis stand over time vs fundamentals. Herd mentality, the big discords...I want to know it all..
I'm open to any other things worth knowing!
Thank you!
BTC and the pi algo top predictor? In this video, we go into great detail describing the theory of the pi indicator, Fibonacci multipliers, and how these 2 alone could show how tops were predicted in the past and potentially the upcoming top. This is the stuff people would kill to know ahead of schedule. I would urge you to play with the math behind this.
As above, so below and there is nothing new under the sun...
Bull flags explainedBull Flags are one of the most well known & easily recognized chart patterns.
The most important factor in identifying any flag pattern is the clear "staff" or "flagpole"; there should be a straight run upwards leading up to the pattern or it is not a valid pattern.
After the straight run upward price starts to Zig Zag between two converging trendlines forming a tight wedge (it can be slanted, or even symmetrical) until the price "breaks out" above the upper trendline signifying a possible continuation in trend upwards.
Bull Flags have the highest success rate out of any pattern and work extremely well when paired with long term support & resistance areas. Enter at the invalidation point of the pattern (A), second entry on the bullish retest (B). Pennants that are “tighter” have higher success rates, look for patterns forming on top of long term resistances (not below) to increase probability of success also. Pattern height is measured and added to swing low before breakout for possible target.
Sometimes large size traders can generate liquidity by faking out under the pattern support as we can see on some of the examples. The liquidity generated by triggering stop losses underneath the pattern can fill large position sizes for whales and is a good indicator for a long position once the price confirms support back inside the pattern.
EDUCATION: PitchforkHello, dear subscribers!
Today we are going to consider a very important tool of trend trading - the pitchfork.
What is the Pitchfork?
The pitchfork is the variant of the trend channel. The difference is that pitchfork has an inner additional channel inside the big main trend channel. The median or the centraline divides these channels in to two parts. It is commonly known that the price usually tends to vary in the upper or lower pitchfork half. Thus the price can often find support and resistance next to resistance, support and central lines.
Support, resistance and breakouts
When the price breaks through the central line the price changes the half of the pitchfork. Sooner or later there will be the massive brakeout as a result of which the price escape the pitchfork. In our example the price broke through the resistance line and found the support above it. If the price has an attempt to return back to the pitchfork and this attempt was rejected we can expect the massive price growth.
Trading
Let's talk about the trading opportunities into pitchfork. We should observe carefully the monents when the price is next to the resistance, support or centraline. If there is a confirmation of the bounce off it the position should be executed in the direction of this bounce.
DISCLAMER: Information is provided only for the educational purposes and should not be used to take action in the markets.
EDUCATION: Rising Wedge PatternHello, dear subscribers!
Today we will continue to consider the chart pattern. The risisng wedge is the topic of this article.
We can see the rising narrowing wedge formation when the scatter of highs and lows is decreasing during the time and price make higher highs and higher lows. There are clear support and resistance lines which have different angles of slope as you can see on the chart
The rising narrowing wedge is usually described as the bearish pattern but in practice it is not always true. In fact the direction of the breakout is the most important evidence for the price movement prediction. In this example we can see the break through the resistance line and the massive price pump.
The breakout can be fake, in that case the price returns back to the wedge. If it is true breakout the price can make an attempt to return back but there is a rejection as you can notice in our example.
DISCLAMER: Information is provided only for the educational purposes and should not be used to take action in the markets.
How Much BTC Do You Need to Create Generational Wealth?Hi Tradingviewers, in this article I am going to break down this question into smaller items and try to give a concrete answer to the question: “How Much BTC Do You Need to Create Generational Wealth?”
First, we’ll have to define what ‘wealth’ means. Then we need to define how we look at the ‘generational’ part. Lastly, we also need to take into consideration long term outlooks on Bitcoin. Let’s try and put some actual numbers on this and see how much BTC you would actually need.
I’ve been on Twitter a lot lately (putting some more effort into my account!) and got inspired to answer this question as this was a very common topic on Twitter. The interesting thing is that I saw a lot of people talking about this, but nobody actually made an effort to go through the math. Without further ado, let’s dig into the numbers.
First let’s look into some options to define wealth. Using data from the World Inequality Database and Statistics Canada), it takes about $488,000 to be considered part of the top 1% in the U.S in 2019. Let’s assume that this applies to the number needed in a family/household. Let’s make ~$500,000 our first option, I’d say belonging to the top 1% in the US would be a pretty fair definition of wealth.
If we look further than the US, we can also use this same 1% methodology to define wealth on a global scale. In that case you would need at least $744,400 in combined income, investments, and personal assets according to the global wealth report from the Credit Suisse Research Institute. A slightly more ambitious goal compared to our first option but we could define this as ~$750,000.
Another option to look at wealth is to look at financial independence . My preferred way to define financial independence is to have enough wealth such that you can completely live off the dividends. A common rule used by the FIRE community (Financial Independence, Retire Early) is the 4% rule. The 4% can be summarised as a safe withdrawal rate that will not lower your total wealth over the long run. Even when there are temporary downturns in the global economy. This assumes you invest all your money in the stock market.
The median household income in the US is $61,937 per year. We could consider a passive income of the median household income as wealthy. If we divide $61,937 by 4% from the safe withdrawal rate above we get to a total of $1,548,425. So using this logic you would need roughly ~$1.5M in total assets in order to be considered wealthy.
Now, let’s discuss the generational part. Honestly, I was surprised when I found the exact definition: “ generational wealth represents assets passed down from one generation to the next. If you can leave behind a notable inheritance to your descendants, that constitutes generational wealth. These assets can include real estate, stock market investments, a business, or anything else which contains monetary value. I had somehow expected it would be something more ambitious such as that for x generations they would all have to be considered “wealthy too”.
Achieving generational wealth would then be relatively easy given method one and two. You would just need to make sure something is left of your $500,000 or $750,000 respectively. Option three even has it implied. The whole idea behind option three is to never actually spend any of your wealth, you’re simply living off the dividends.
This leaves us with the most difficult one: how much Bitcoin would you need? The first and most obvious approach is to directly calculate the amount of bitcoin that represents our different definitions of wealth given the current price. If we take a Bitcoin price of $30,000 that would give 16 bitcoin for option 1, 25 bitcoin for option 2 and 50 bitcoin for option 3.
Now let’s bring in some of the nuance. First of all if you’re expecting to live off your dividends you cannot have all of your wealth be in bitcoin itself as it doesn’t pay any dividends directly. Normally the wealth would be in the stock market or in real estate.
Also, if you assume that the value of bitcoin will keep rising you would obviously need far less bitcoin today to achieve generational wealth later. For example, Bloomberg analysts have predicted a price target of $50,000 for Bitcoin in 2021, implying a $1 trillion market cap for just this cryptocurrency. JP Morgan analysts estimate the price of Bitcoin to grow more aggressively, as they estimate a value of $650,000 by the end of 2022.
Let’s be more conservative on the date, but keep an aggressive price target for the sake of the argument here. If we take a $300,000 price target by the end of 2031 how much bitcoin would you need today to achieve generational wealth? This would give us 1.6 bitcoin for option 1 2.5 bitcoin for option 2 and 5 bitcoin for option 3. Specifically for option three it would still mean though that you would have to cash out all your crypto assets and convert them into dividend generating assets instead.
Also, with a possibility to see hyperinflation later given that 35% of all dollars in existence have been printed during the last 10 months it is questionable whether thinking of generational sustainable health should even be expressed based on dollar figures to begin with. I wouldn’t know how to express it in any other way, but am really curious to hear if anyone has good alternatives on this point.
I am really curious to hear your views on this. I used many assumptions here, how would you have approached this? Are there any flaws you see in my logic? Feel free to comment on anything, and please feel free to absolutely destroy it! I’d love to have the discussion.
Just to summarize, based on this you would need today:
16 bitcoin to be considered among the top 1% wealthiest in the US
25 bitcoin to be considered among the top 1% wealthiest in the world
50 bitcoin to achieve generational financial freedom
Trading-Guru
p.s. You might have seen a few reposts of this article as Tradingview was struggling with a faulty spam detector. The moderators kindly helped blocking and unblocking some posts. Thanks @scheplick!
EDUCATION: Head And ShouldersHello, dear subscribers!
Today we are going to consider the most reliable chart pattern - Head and Shoulders (HS). We ask you to support us with likes, it's not difficult for you and it will help us a lot. Thank you!
The Head and Sholders chart pattern is the most popular pattern and if you use it in correct way it can give you a relevant confirmation for your trades.
First of all we should understand that HS is the reversal pattern. It has a bad perfomance when it is used for the trend continuation definition.
As you can see on the chart the price was in uptrend for a long period of time.
After that two price swings formed the left shoulder and the head, but at the moment of head formation it is not understandable that it is HS pattern.
You should observe the market carefully when the price bounced off the left shoulder top level and started to form the right shoulder.
The HS formation is completed when the price reached the neck line area. This is a nice moment to short. Let's talk about the neck line. It is not obligatory should be horizontal. It can be ascending or descending in the dependence of lows levels between left shoulder and the head and the head and the right shoulder.
DISCLAMER: Information is provided only for the educational purposes and should not be used to take action in the markets.
EDUCATION: Hidden Bullish DivergenceToday we consider very powerful technical analysis tool - the Divergence.
Definition
The divergence is a situation when the price change is not supported by the oscillator. There are four types of divergences:
1)Regular bullish - the price shows lower highs, while the oscillator shows higher lows
2)Hidden bullish - the price shows higher lows, while the oscillator shows lower lows (you can see on the chart)
3)Regular bearish - the price shows higher highs, while the oscillator shows the lower highs
4)Hidden bearish - the price shows lower highs, while the oscillator shows the higher highs
Divergence Trading Rules
Let's consider the market uptrend situation. If there is the hidden bullish divergence it means the uptrend continuation. In case of regular bearish divergence there is a high probability of trend reverse from uptrend to downtrend.
Another situation is when the market is in downtrend. The regular bullish divergence in this situation can be the evidence of trend reverse in the future. In case of hidden bearish divergence the downtrend will continue with high probability.
Indicators
You can search the divergences not only with Stochastic RSI. Other oscillators are also suites great here. For example, CCI, RSI, Volume oscillator, MACD and other.
EDUCATION: Scalping 3-EMA StrategyHello, dear subscribers!
Today we are going to talk about the popular 3EMA scalping strategy which is usually used on the 1-min timeframe, but we can demonstrate it only on the 15-min chart because of restrictions.
Step 1
First of all we should define that the market is in short, medium and long term uptrend. The 200EMA shows the long, 100EMA - medium and 50EMA - short trend. Consequently all the three EMAs should follow in one direction, it's slope should be strictly positive for the uptrend identifying. The uptrend is an obligatory condition for the long position execution.
Step 2
If the step 1 condition is true the next step is to identify entry points. We should enter long position when the price crossed the 50EMA from up to down, but after couple of candles crossed it again from down to up
Step 3
Take profit and stop loss identifying. You should stop loss if the price crossed the 100EMA line from up to down. Take profit setup can be different: the fixed % growth, the price and 50EMA crossover and the price and 100EMA crossover
EDUCATION: Parabolic Growth PatternHello, dear subscribers!
Today's topic is parabolic growth pattern (PGP). This pattern can be applied for the current BTC price analysis.
What is the parabolic growth pattern?
This is a price growth pattern which is formed by the sequence of the bases and price pumps. The base is the price consolidation period after the price growth period.
How to draw it?
The main rule for PGP formation is that the parabola have to touch at least two points from the different bases. You can use arc to apply it on the chart.
How to analyze with PGP?
You can obtain some useful information for the price movement analysis when two bases have already formed and the third base formation is in progress. The main feature of PGP is that when the base 3 is completed the massive growth with a high probability there will be. This growth can be equal to the price change from the beginning of the formation of the parabola, but this growth is much more rapid.
After the last huge price move we should wait the pullback to the base 3 level. This pullback can be sharp or smooth but it is inevitable.
EDUCATION: Engulfing Candlestick PatternHello, dear subscribers!
The topic of this article is the Engulfing candlestick pattern. To be honest the candlestick patterns are almost useless if you use only this. But this is a great trend confirmation, so we will consider engulfing pattern with the Alligator Indicator which was described in one of the previous articles.
What is Engulfing Pattern?
The Engulfing Pattern can be bullish and bearish. The bullish one is the situation when the red candle is engulfed by the next green candle. It is not important if the candleweak was engulfed too or not. This is a subject for thought. Also it does not mean if the only one green candle or two consecutive candles absorbed the previous red candle.
The bearish Engulfing candlestick formation is exactly the opposite situation.
The Strategy
You can search by yourself the ehgulfing patterns on the chart and notice that it generate a lot of fake signals, it means that we should use the indicator for the trend definition. In our example we use the Alligator indicator to do it. As you already know the Alligator has two phases - the sleeping and feeding time. If the sleeping time is over the jaw, teeth and lips of the Alligator become wider. At this point we should find the Engulfing formation to confirm the new trend. You should enter a long position at the point which you can see on the chart.
EDUCATION: Ichimoku - Part 2Today we continue to study Ichimoku Indicator trading strategies. Last time we analysed in details the conversion, base and lagging span lines. In this article we apply Kumo cloud which is formed by Leading Spans A and B. The formulas for the calculation you can see on the chart.
The Strategy
Before considering the strategy we should understand that the Kumo cloud is projected forward for 26 periods. The simpliest version of the Ichimoku strategy employs just the Kumo cloud. We just should define the point where the Lagging Span A crossed the Span B from down to up and execute the long position.
It is also recommended to define the long positions entry points more strictly. The price should be above the Kumo cloud and the conversion line should cross the base line from down to up near the Span A and Span B crossover.
When to exit? You can exit long positions with three possible ways on your own preferences:
1)When the price crossed the Kumo
2)When the Span A crossed the Span B from up to down
3)When the conversion line crossed the base line from up to down
You should test it by yourself.
EDUCATION: Ichimoku - Part 1Hello, dear subscribers!
Today we starting the training series of the Ichimoku Indicator trading. This article is about the Ichimoku definition and the easiest trading strategy using it.
What is the Ichimoku Indicator?
This indicator consists of 4 components:
1) Conversion Line - the 9 period high - low average price, demonstrates the short term period trend. When the price above it - the market is in local uptrend.
2) Base Line - the 26 period high - low avearge. It means the same as the conversion line but in the medium term period.
3) Lagging Span - close price plotted 26 period in the past. It can be used for the trend confirmation. When the lagging span is above the price it means the strong uptrend.
4) Cumo Cloud Lines - this lines will be examined in the next education article.
Ichimoku Strategy (Conversion + Base + Lagging Span)
The first Ichimoku strategy is very easy to apply for your trading. First of all you should filter signals with the lagging span: when it is above the price - it is time for long, in opposite - for short.
When it is done you should find the point, where the conversion line crossed over the baseline from down to up and execute long position.
You can exit long the conversion line bacame lower that the base line. The additional confirmation for exiting the position is the lagging span and price crossover.
Next time we will examine the most interesting part - the Ichimoku Cloud and appropriate strategies.
EDUCATION: Bollinger Bands Hello, dear subscribers!
The next topic of our education is the Bollinger Band channel.
What is Bollinger Bands?
BB channel consists of three lines: the moving average of close price, the MA plus/minus 2 standard deviations. This channel defines the most likely price swings range.
How to trade with BB?
There are two different situations for the BB trading.
The first one is the trading during the consolidation phase.
You should open the long positions when the price broke the lower BB and close when it reached the centraline. The short position you can open when the price hits the higher BB and close on the centraline.
The second situation is the trend trading. According to theory the periods with low volatility are preceded by the high volatility periond. When the the volatility is low the BB channel is squeezed and it is a good time to searching for the potential trend beginning. You can use Money Flow Index or other volume-based indicators for the trend confirmation. For example, when the price hits the higher BB and the money flow index value rapidly increased it can be the evidence of potential uptrend beginning.
The most difficult and important problem of the BB trading is the trend direction definition. If the trend is defined correctly this strategy becomes very profitable.
EDUCATION: MACDHello, dear subscribers!
Today we will examine another one lagging indicator - MACD. It is very useful indicator but you need to use it carefully because usually it is just adds other indicators and can to generate a lot of fake signals.
What is MACD?
MACD consists of:
1)MACD (blue) = EMA(12) - EMA(26)
2)Signal (red) = EMA(9)
3)Histogram = MACD - Signal
The MACD line is the long EMA value substracted from fast EMA value. It shows the trend direction. If the MACD>0 the market is bullish, if MACD<0 - bearish. The difference between MACD and Signal line is the proxy of trend strength.
How to trade with MACD?
The classical approach to MACD is to search the MACD and Signal line crossovers: when the MACD crossed the signal line from down to up it is the bullish signal, in opposite case - bearish. The MACD and zero line crossover means the trend confirmation. But this approach is not good enough to make profit. As you can see on the chart it can generate fake signals or signals which are too late - the price have already grown. If you want to use only MACD, please, find really strong signals. For example, if the price demonstrated higher low and MACD - lower low, it is the hidden bullish divergence. With the further MACD and signal lines crossover it gave a really nice long signal.
Summary
1)Find the price/MACD divergence
2)Wait for the MACD and signal line crossover
3)Enter an appropriate position
4)Be careful about weak signals
5)Use MACD with other indicators as an addition confirmation sign
EDUCATION: Pivot LevelsHello, dear subscribers!
Today we are going to talk about one of the most useful indicators in cryptotrading - pivot levels(points). We have already considered the lagging and leading indicators and decided that the second one is the most valuable.
Definition
Pivot levels is the leading indicator which define the potential pivot levels for the next trading period (in our example - month). The formulas for the levels calculation you can see on the picture. It is known that when the price is up of the central pivot - the market is in the uptrend, if the opposite - in the downtrend.
How to trade with pivot levels
It is great to use pivot level with some lagging indicator to confirm the entry points. This indicator can give the information about levels when the price can bounce off or reverse. You can see the points with small red arrows where the price bounced off pivot levels and went down after it - this points can be used for the short position. The green arrows demonstrate the potential price growth points. But there are also a lot of breakpoints (blue circles), to avoid the trade execution next to these point you need to use some confirmation with lagging indicator.
Summary
1)Define the trend direction
2)Open short if downtrend, long - if uptrend
3)Define the entry points next to pivots
4)Find the confirmation with some lagging indicator to avoid the pivot break points
5)Execute the trade, set the sloploss level
Good luck!
EDUCATION: Moving Average Support LineHello, dear subscribers!
Today we examine another one support line type - moving average support.
Definition
Moving average support line is one of the advanced types support lines. It based on price moving average for any period which can be chosen for every particular case. MA helps to define the trend direction at current moment. If the price closed above the MA for at least ten candlesticks in a row we can identify this situation as uptrend.
How to trade with MA support?
Because the uptrend is identified we cam use the MA and price crossing points as entry points. In our case, when (1), (2) and (3) occurs, the next points from (4) to breakpoint can be used to enter the position. In case of success we will see the price touched and bounced off the MA. In opposite, the price break the MA line down, but the stoploss usage can help to eliminate huge losses.
Summary
1)To identify the uptrend when the price closed above the MA 10 times in row
2)To entry the position when the price touched the MA
3)Fix the profit with it's bounce off the MA
4)Set the stoploss to eliminate the losses in case of sharp price decline
EDUCATION: Trend Support LineHello, dear subscribers!
Yesterday we considered the simple support line. Today we continue to examine support types.
Definition
Trend support line occurs where the price is in the uptrend and is formed by the lows on the candlestick chart. Next to this line the price is likely to bounce off it because the demand/supply imbalance.
How to trade with trend support?
When we can draw line which connects 3 lows (1,2 and 3 points), the next lows which are lying on this line can be the properly entry points. Also we need to take a stop loss to eliminate the significant price decline effects. According to the chart this strategy would bring profit at points (4), (5), (6), (7) and (8). The first loss would be at the breakpoint (B), but the stoploss level reduce it.
Summary
1)To define the support line by three points
2)To enter the position next to the line
3)To fix profit in case of success
4)To fix a small loss with the stoploss setup in case of support breakout
