So I've just finished reading through Alexander Elder's 'New Trading for a Living', and I'm trying to follow the spirit of the book as much as possible here. I've been watching the activity for the weekend and have been waiting for a drop to one of the lower supports to enter, but this latest little wedge breakout looks like it might afford some short term swing opportunity so I'm looking at making a trade.
RULE OF 5 - The first way I'm doing this is by following multiple time frames. I usually watch the 30 minute chart, so I'm giving myself the green light on this trade by watching the 3 hour chart. The rule of 5's states to use 5x your preferred, 'intermediate' window to check your entry, and use 5x less from your intermediate to time it. Now 5x 30m is actually 3.5h, so I am cheating a bit here.
IMPULSE INDICATOR - This indicator is a negative indicator, basically this means that it only tells you when you CANT trade. If the Impulse is blue or green, you are clear to buy, if it's red or blue, you can short. We're good on the 3h, so I can start looking at the shorter timelines to pick my entry. If you want to know how the Impulse system works, read here. : stockcharts.com...school/doku.php?id=chart_s...
ENTRY AND EXIT - Elder says never make a trade without a plan. That means having an entry, a stop, AND an exit. At the time I started looking at this BTC was trading around $3689 on Coinbase. I'll set a stop below the most recent 3h candle's low at $3663, and I'll plan on taking a modest profit at the top of the downward resistance line, somewhere at $3755 or lower. I think that we're in a bear market long-term, so while I hodl my main wallet I'll try to build up my trading account a bit on the swings.
2% RULE - Never risk more than 2% of your account on a single trade. I've got just over $3K currently, so I don't want to risk more than $60 on this trade. If I look at my entry minus stop, we're looking at $20 or so, which is way less than my allowed risk. I'm good to go.
RULE OF 5 - The first way I'm doing this is by following multiple time frames. I usually watch the 30 minute chart, so I'm giving myself the green light on this trade by watching the 3 hour chart. The rule of 5's states to use 5x your preferred, 'intermediate' window to check your entry, and use 5x less from your intermediate to time it. Now 5x 30m is actually 3.5h, so I am cheating a bit here.
IMPULSE INDICATOR - This indicator is a negative indicator, basically this means that it only tells you when you CANT trade. If the Impulse is blue or green, you are clear to buy, if it's red or blue, you can short. We're good on the 3h, so I can start looking at the shorter timelines to pick my entry. If you want to know how the Impulse system works, read here. : stockcharts.com...school/doku.php?id=chart_s...
ENTRY AND EXIT - Elder says never make a trade without a plan. That means having an entry, a stop, AND an exit. At the time I started looking at this BTC was trading around $3689 on Coinbase. I'll set a stop below the most recent 3h candle's low at $3663, and I'll plan on taking a modest profit at the top of the downward resistance line, somewhere at $3755 or lower. I think that we're in a bear market long-term, so while I hodl my main wallet I'll try to build up my trading account a bit on the swings.
2% RULE - Never risk more than 2% of your account on a single trade. I've got just over $3K currently, so I don't want to risk more than $60 on this trade. If I look at my entry minus stop, we're looking at $20 or so, which is way less than my allowed risk. I'm good to go.
交易進行:
Only took 10 minutes to reach 3752. Raising stops and watching for next resistance at 3790
交易結束：目標達成:
Looks like we just hit strong resistance going back all the way to $4600. I'm closing out and calling it a night. Not bad for half hour.
評論:
Correction on that last comment. Resistance we just hit started at $4118. Graph above is not right timeframe: