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Dear Crypto Trader,
thanks for downloading this Freebie intended to help you to dramatically increase your trading performance!
If you learn the right tactics and use them with discipline and – of course – fun, you can become financially independent and free.
Become a pro trader to create the life of your dreams.
This ebook is about one specific crypto trading strategy which has already pretty often led to nice gains, or even massive ones..
Be aware that every trading strategy always comes with a certain amount of risk – price can always turn against you – but that’s no big deal if you make sure you get out early again. The trick is to cut losses short and to squeeze the most out of the winning trades.
The following is among the trading strategies used by professional traders knowing the most proven techniques and procedures.
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First of all the boring stuff we must include..
Disclaimer:
This ebook is for information purposes only. The content in this book should not be
considered financial advice. Your investments and trades are your very own decision.
We do not make any promise or guarantee as to any results that may be received from
using our information. Readers of our content should never make any investment or
trading decision without first consulting their own research or their own financial ad-
visor.
The information in this ebook does not claim to be complete, reliable or accurate.
We disclaim any and all liability concerning any information, analysis, advice, opinions
and/or recommendations prove to be incomplete, inaccurate or unreliable. The infor-
mation in this ebook may not be responsible for any investment or losses of readers.
The content in this ebook it not intended to constitute financial advice in terms of in-
vestments or trades. The reader’s use of the information or of information on linked
external websites is at the reader’s own risk.
Please note the following:
Never trade more than you can afford to lose.
Only trade after extensive research.
Be aware that Crypto trading can be dangerous for personalities which are
prone to addictions, comparable to gambling. Make sure you avoid addiction
in order to secure your lifestyle.
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Setup for a Breakout Strategy Example:
Definition:
We define what we are looking for: A breakout of an altcoin that is currently on a very low price level compared to it’s overall chart picture. Due to the low price level there is a lot of upside potential.
Duration:
Time frame for the trade duration after the entry would be several days (maybe even few weeks) – Bigger moves can also occur with-in a single day, but more often it takes a little longer, depending on the general market situation.
Charting:
We use charts in BTC (not USD), our goal is to get more BTC.We use at least 2 time frames, e.g. for free on Tradingview.com (use for free, no need to purchase a plan):For example the daily (D), and the 3 hour (3h) chart.
(The daily chart is just to see the chart from a higher perspective, so you see how low price actually is in the bigger picture and some other details, such as key price levels of the particular chart.)
The 3 hour chart is the time frame we want to trade in, as this fits to a trade which is supposed to run for at least a couple of days, (up to even a few weeks). So after having checked the daily chart, we switch to the 3 hour view.
Planning The Details:
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Before we actually buy, we need to look for a precise entry.
The following examples are the kind of charts we’re looking for. Their bigger picture (1Day chart) is showing past pumps and cur-rently a low price level:
Since we want to buy low and sell high, the sticking point is to look for clear breakouts of the low price zone.
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Otherwise you might have to wait for weeks or months till price coincidentally finally starts into a bull market again – in case it does.
So we look for the combination of 2 factors:
Low price altcoins + signals of confirmed breakout
That way you don‘t get the very lowest entry price, but the chart is more likely to go up soon. And that‘s our point – profit from an up-trend as soon as possible and not somewhere in the future.
Here is a chart example of what we are searching: A chart which looks like it might have past it‘s bottom and could be about to start an uptrend in the near future.
Our Trade Example
First sign of breakout in daily (D) chart
Use such Trend Lines!
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We found a daily chart showing signs for a breakout into a new uptrend. The previous longer downtrend had been broken recently and price seems to head upwards.
Now Comes The Trick:
The strategy is to buy at a point where the new uptrend seems confirmed.
So it‘s more likely not just a fakeout which falls back to the bottom, but really the beginning of an uptrend.
What we want to see is a higher low staying above the last resis-tance layer in our trading time frame which is the 3 hour chart.
So in the previous picture you see the daily chart and the following one is the same chart, but on a 3-hour time frame (zoom into lower time frame to see the price action more precisely. Also the 3 hour chart is the time frame we want to basically use for our trade):
price should stay above resistanceto show a “real” breakout
resistance layer
wait if new support gets confirmed by price staying above AND forming a new
higher low
3hour chart – first sign of breakout in lower time frame detail
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The breakout seems confirmed when the price stays above the recent resistance, which should turn into support.
Then the chart should be forming higher lows and higher highs as key indicators for a new prevailing uptrend.
Entry should always be near a low in your trading time frame, not at a high! = “Buy The Dip”
Confirmed Breakout:
higher lowslow
entry
stop loss
volume should stay increased since breakout
higher highs
high
So in our example price stayed above the recent resistance and even formed a higher low compared to the previous low.
When the next higher low seemed manifested by price heading upwards again we used it as buy signal: Trade entry.
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Right after your entry it‘s crucial to set a stop loss order as there is of course never a guarantee for anything.
Price could dump over night because of sudden negative funda-mental news and stay under your entry. That‘s what you want to avoid.
A stop loss makes sense at an area where the trend would defi-nitely seem to be broken (at least for the moment) – that‘s where pro traders get out of it quickly before bigger damage can happen!
Just as a reminder what happened to thousands of traders in summer 2017, when they didn‘t expect their coins to go down that much.
Not having an emotional problem with being stopped out separates the winners from the losers.
Pros can take it rationally: One big gain will compensate a couple of small losses by far. Especially in crypto. So not getting emotion-ally caught by one single trade is very important.
entry
stop loss
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We estimate where price might head to within the near future.
The estimation of a potential price target is part of every pro trad-er’s strategy, because this frame work justifies the trade.
Only if you have an idea where price might be heading to, you know if the trade is worth a try or not.
How to Estimate Profit Targets:
So why do we think that price could rise at least 50% or more in this case in the chart example we chose for our trade?:
In this example we use former resistance and support areas for our estimation. When price starts to climb up again, it often tar-gets former key price levels.
Estimated target zone based on former key price level (where price repeatedly went back to
from both directions)
Again the daily chart of our trade example – showing price action over months
In the bigger picture of the chart above there is this obvious key price level to which price had moved back from both directions,
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well shown by the chart image. Such an area is generally a high probability target.
In crypto there is always the chance that price could pass this tar-get zone with ease and move further upwards. Then traders can still adjust their trade management.
But first, traders should always have an estimation for a minimum target zone that price is most likely going to hit, as part of a decent trading strategy.
So the most likely next key price target seems to be the marked zone in this case.
Here you see the target in the 3-hour detail near our entry:
recent resistanceentry
stop loss
Target Zone
Again zoom into detail: 3 hour chart – breakout zone in relation to target zone
As soon as you can move your stop to break even, because price has left the zone clearly behind it, you‘re already safe in any case:
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move stop loss up to or slightly above entry (to cover trading fees) = stop at break even
Target Zone
entry stop loss order
Example Of Price Hitting Target Zone In an older trade example price had already hit the target, so we use this example to show options how a trade can be managed when the target is reached.
Let’s have a look at our hedging strategy from this similar trade:
entry
move stop loss up stepwise below new support zones
support layers Initial target zone: when reached you could take partial profit as hedging strategy and for the rest keep the stop loss order in place
Initial Target Zone
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A good hedging strategy is generally to take partial profits.
In the example above price had hit our estimated target, so we de-cided to take partial profit (50% in this case).
We kept the rest secured by our stop loss order below the new support area, so we could watch how far price would go.
Getting stopped out with the rest of the position on this level would also have been fine, since we were in profit in any case.
You can take more partial profit stepwise with the rest of your po-sition around highs of the wave movements of price.
The enhanced stop loss will always secure the rest.
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The Breakout Strategy at a Glance:
Look for Altcoins being overall on a low level in the bigger chart picture (daily/3-day chart)
Look if there is a first sign of a breakout
Look if breakout gets confirmed by resistance turning into support and higher lows/higher highs
Estimate target zone based on former key price layers
Define your entry price near a low
Define your stop loss under the support linewhich mustn‘t get broken – otherwise get out
Handle the trade, manage risk. E.g. take partial profit, move up stop loss for the rest. Take profit higher or keep moving the stop loss.
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Content Copyright Information:
This ebook is a production of cryptotradingbook.com. We hold full ownership and copy-
right of the content within this ebook. We keep full rights to public distribution.
Chart Images:
© Tradingview.com
