Disclaimer: I am not a professional trader, I'm just a regular guy trying to share some of my knowledge on cryptocurrency and hopefully making this a platform for us to share our thoughts!
Okay, I will just jump straight to the point. Today I'm gonna share some of my trading strategies when trading bitcoin(cryptocurrency). I can't promise to be 100% working but for now, this strategy is working for me and I been able to earn quite a fair bit while using this strategy.
Okay, the strategy is...
Everything you see is all about trend reversal trading, where we will look at candlestick that indicates a trend reversal.
This usually happens toward the end of a trend, whether be it uptrend or downtrend, where the middle candlestick forms Doji and gapped away from the previous candlestick and next candlestick gap upward, away from the Doji.
This will give a good trend reversal signal to place a trade. Usually doji gives a good and reliable signal to place a trade, so whenever we see a doji we will follow closely and see the following candlestick and place a trade.
This candlestick will occur towards the end of an uptrend when the middle candlestick opens a new high and close below 50% of the previous candlestick.
This will give a relatively good sell signal.
This is a trend reversal pattern that can occur during both uptrend or downtrend. As you can see the long bearish candlestick completely cover the previous candlestick which gives a good signal for a downtrend trade.
This usually happens at the end of uptrend where short-bodied candlestick forms followed by bullish candlestick which closes below the halfway mark. Signifying a trend reversal, it will be good to put a sell trade here.
Hammer candlestick often occurs at either end of uptrend or end of a downtrend and it is quite easy to identify. All we got to look out for is a short body with long shadow, representing a 'hammer shape'. This candlestick indicates a signal to buy or sell but always wait a confirmation candlestick to place your trade.
Marubozu candlestick is very simple to understand, one solid candle with no shadow. And there are only 4 possibilities;
If a White Marubozu occurs at the end of an uptrend, a continuation is likely.
If a White Marubozu occurs at the end of a downtrend, a reversal is likely.
If a Black Marubozu occurs at the end of a downtrend, a continuation is likely.
If a Black Marubozu occurs at the end of an uptrend, a reversal is likely.
let's go through a few example.
This is a screenshot from Poloniex Exchange, the currency is NXT/BTC.
As you can see a Doji is from at the end of the downtrend, this is our first signal to buy.
The second signal is by looking at the MACD area where the two lines are converging and going upward, this provides a good signal for you to buy a trade.
Simple and profitable strategy for you guys to use. I understand that this strategy might not be working all the time, and TIMING is very crucial, once you missed the signal, that's it! Do not place any trade, as the signal or trend might not last very long. Maybe, the next moment it will be a downtrend and you will lose your money.
I will say, that I am a risk averse person. So if you are like me, you could do the same too. For me, I only trade short term, 5mins to 15mins interval and nothing more, because cryptocurrency is very volatile as the price may drop very fast. That is why I only catch a small trend, earn a bit of profit and get out before the price drop.
Alright, thank you guys for spending your time to read my post.
I hope this post may help those who just started learning how to trade cryptocurrency. As when I first started, I lost more money than I earned, but I learn from my mistake.
Most importantly let's help each other out and make money together!
Thank you once again for your support and wish you all the best in your trading! Comment down below if you have other interesting ways of interpreting cryptocurrency's trend.
If you like my post, please donate to me at this bitcoin address: 39xKuT4DgT76FSCs6M4Bnj6NiQ2UPJw66h
I really appreciate it and stay tuned for my next post!
