Trend Following: when to consider if a buy #Singal is valid
Its likely for the #BTC and other coins to #down #trend or at least keep sideway for sometime. As a trend following trader, We should not be looking for the dip to buy as it wont be a low risk entry point, espcially when #volume could be a misleading parameter for lower timeframes.
Entry:
With some #technical #analysis grounds, proper #entry should be made when these conditions are met:
1. Price makes a breakout (better with chart pattern)
2. A higher than average volume.
3. Moving Averages on Price are positive (Slow<Fast<Close).
4. RSI corsses above 60.
5. RSI moving averages are positive.
Managing Trade:
To track an ascending #Trend, make sure to track:
- RSI be within 40 - 80 zone.
- Tracking Positive Reversals achieving targets.
- Positive Reversal conincides with Bearish Divergence
- Higer time frames are confirming positive signals appears in lower frames.
- always find support lines where Reversal points occur.
- proper technical #trendlines
Stop Loss:
- there are two way to place your stop loss properly. Both depends on trader’s financial risk tolerance.
1. Portfolio-based Stop: where you place stop price at the threshold where accepted risk is maximum of 2 to 3%. It really depends on how you manage risk on your portfolio or trade which may reach up to 7 to 8%.
2. Technical-basesd Stop: where a stop is placed not based on money at risk but where it is the least likely for price to hit.
- Both stop decisions should be taken before executing the trade.
Emotional Control
Trade the chart not opinions or emotions of greed or fear. Don’t let others distract you from properly manage your trade. Use what you know is works for you and stick to it. Never listen to others for help. Its your money, your business .. take full responsibilty for your decisions. You are #bullish until you are given a #sell or #short signal #technically.
Hope this would help traders finds a better #entry points where thier risk exposure is at minimum which makes it easier to manage.
@TFStrategist
Entry:
With some #technical #analysis grounds, proper #entry should be made when these conditions are met:
1. Price makes a breakout (better with chart pattern)
2. A higher than average volume.
3. Moving Averages on Price are positive (Slow<Fast<Close).
4. RSI corsses above 60.
5. RSI moving averages are positive.
Managing Trade:
To track an ascending #Trend, make sure to track:
- RSI be within 40 - 80 zone.
- Tracking Positive Reversals achieving targets.
- Positive Reversal conincides with Bearish Divergence
- Higer time frames are confirming positive signals appears in lower frames.
- always find support lines where Reversal points occur.
- proper technical #trendlines
Stop Loss:
- there are two way to place your stop loss properly. Both depends on trader’s financial risk tolerance.
1. Portfolio-based Stop: where you place stop price at the threshold where accepted risk is maximum of 2 to 3%. It really depends on how you manage risk on your portfolio or trade which may reach up to 7 to 8%.
2. Technical-basesd Stop: where a stop is placed not based on money at risk but where it is the least likely for price to hit.
- Both stop decisions should be taken before executing the trade.
Emotional Control
Trade the chart not opinions or emotions of greed or fear. Don’t let others distract you from properly manage your trade. Use what you know is works for you and stick to it. Never listen to others for help. Its your money, your business .. take full responsibilty for your decisions. You are #bullish until you are given a #sell or #short signal #technically.
Hope this would help traders finds a better #entry points where thier risk exposure is at minimum which makes it easier to manage.
@TFStrategist