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BTCUSD 4H KELTNER CHANNEL RANGE TRADING STRATEGYTrading Ranging Markets with Keltner Channel It is said that the number one account killer in the market is a ranging market. Consolidations are very difficult to trade. However, you can take advantage of the difference in the way the Keltner channel system can be used in combination with other technical indicators. The price won’t really touch the bands when it bounces between the upper and lower envelopes. When we’re in a ranging market, you’ll often see that the price will fail to touch the bands. The majority of the time the price will hug the middle band. This anomaly in price behavior requires us to use a secondary technical indicator to find profitable trades. Since the Forex market spends most of its time in consolidation (around 70% of the time), it’s mandatory to have a range trading strategy to survive in this market. For range trading, we like to use Keltner Channel bands in combination with a 2-period RSI indicator. We tweaked the RSI settings so we can better identify tops and bottoms within a trading range. *Note #3: For this Keltner trading strategy we use the 90-10 levels of overbought and oversold readings. Here are some rules that can guide you to make the best trading decisions: Keltner envelopes need to turn flat, to signal a consolidation. The price needs to break below the middle band. A buy order is triggered once the 2-period RSI goes below 10 indicating oversold conditions. The protective stop loss can be hidden on the other side of the Keltner band. For the long side take profit when the RSI reaches the 90 levels.
COINBASE:BTCUSDEducation
by Tradingstrategyguides
2
BTCUSD 4H HEIKEN ASHI REVERSAL STRATEGYn Japanese, Heiken Ashi means “Average Bar” and it represents the average-pace of prices. The Heiken Ashi candlestick chart can help you to spot both trading periods and ranging periods that you should avoid. There are two primary trade signals that we can identify through the Heiken Ashi candlestick: 1- Bullish candlesticks with no wicks or very small wicks indicate a strong uptrend and excellent buying opportunities. 2- Small candlestick characterized by a small body and big upper and lower wicks signal a potential reversal. Use strategy on all markets and time frames. Step #1: Identify a strong move to the upside. One of the simple ways that we can use the Heiken Ashi candlesticks is to trade reversal when the candles changed color. So, the first thing we’re going to look for a bullish trend or a strong move to the upside. Note* The Heiken Ashi chart tends to give much more extended and smoother runs of bullish and bearish price candles which is because of how the calculation is used to average out the range of the bar. Step #2: Wait for the Heiken Ashi bar to change color from bullish (green) to bearish (red) The first sign that the price is about to turn lower is when we see a red Heiken Ashi candle. In order for the Heiken Ashi bars to change color, there must to be a strong shift in the order flow and this typically translates into a much more reliable signal than we get when typical price candle change color on a normal price chart. The way we look to use this feature is simply to implement traditional technical analysis to locate potential reversal zones with the Heiken Ashi chart. We use the price action reading skills as a filter to identify a potential trade and then we use the Heiken Ashi chart as the confirmation to go ahead and execute the trade. Step #3: The first bearish Heiken Ashi candle needs to have a bigger than average lower wick Long lower wicks can provide an incredible trading signal, especially when using the Heiken Ashi price chart. You can also wait until you see a bearish Heiken Ashi candle with no upper wick. However, this second approach will cost you some profits left on the table. The Heiken Ashi trading strategy satisfies all the trading conditions, which mean that we can move forward and outline what the trigger condition for our entry strategy. Step #4: Sell at the market at the opening of the next Heiken Ashi candle Our entry method is very simple. This is a bullish reversal setup, so we’re looking for buying opportunities once everything is in the right place. Now we can anticipate that a reversal is put in place, and we can go ahead and buy EUR/USD at the opening of the next Heiken Ashi candle. Step #5: Hide your protective Stop Loss above the first bearish candle high. One of the really fantastic things about Heiken Ashi candles and what makes them so great for trading is how we can use them to place our protective stop loss. Because of the tendency of the candles to display continuation, we can go ahead and be really tight with our stops. We can simply place our stop loss above the signal candle high. Step #6: Take profit after we get a close above a previous bearish candle. A good Heiken Ashi trade setup will tend to run for much longer than a usual price action setup. So, when we’re trading with Heiken Ashi candles, we really want to exploit this and keep our trades open for longer than we usually would. Because we’re using such a tight stop loss, we’re only going to need a small price movement to make a good profit on this trade. Note** the above was an example of a SELL trade using our Heiken Ashi trading system PDF . Use the same rules for a BUY trade – but in reverse. PM me if you want to read the complete strategy.
GEMINI:BTCUSDShort
by Tradingstrategyguides
4