If you haven't noticed it already but DigixDAO, DGD/BTC is back!
As I have discussed in my previous posts about the "imperfect" inverse relationship of DGD/BTC vs BTC/USD and the trading opportunity that goes with it.
To a certain extent, it has shown to move rather inversely compare to Bitcoin prices but it has shown that it's definitely not a perfect hedge against a huge dip/downward trend of Bitcoin or the overall market. So don't trade it purely as a hedging instrument/coin against a Bitcoin drop cause it simply isn't and made for that purpose.
But with that being said, there are definitely times/periods that you can see the inverse relationship and since DigixDAO made a bottom around $275 on March 14, it has bounced back considerably with volume back as before the downtrend.
So with DGD/BTC price going up and breaking $400 again, volume has gone up considerably as well, we also can see that the not so perfect inverse relationship of DGD/BTC vs BTC/USD slowly but surely coming back:
(BTC/USD in white candles)
Having the awareness of the inverse relationship is good for your trading but remember not to purely trade on this. Instead, know it's there but trade the underlying coin and its pattern(s).
DGD/BTC has been in a nice uptrend the last day or two and is now forming a sort of an ascending triangle pattern:
If you believe that DigixDAO can hold and continues its upward trend (with perhaps a further weakness in Bitcoin), then look to buy anywhere near the upward trendline in bright blue or wait for a break of the triangle and resistance at around 0.052000.
At the moment I rather go for the buy near the upward trendline approach cause it's closer to the trendline and could fall back a little more to touch the trendline before heading up again and since Bitcoin is moving up again. Taking this approach you'll also have more room for profits.
If not, you can always go for the triangle/resistance break and adjust your strategy and targets accordingly.
This is how you can trade DGD/BTC:
Trendline Continuation
Buy Area
0.046000 - 0.047000
Profit Target
1. 0.052000
2. 0.055250
3. 0.057800
Stop Loss:
0.044500
Triangle/Resistance Break
Buy Area
0.051500 - 0.052500
Profit Target
1. 0.055250
2. 0.057800
3. 0.059500
Stop Loss:
0.049900
Keep in mind that you can take profits at any time when you feel comfortable with or want to secure your profits. You don't have to wait for a target to be reached in order to sell.
And you can always sell a portion and let the rest ride longer. This will give you peace of mind and more patience to stay in the trade and let your winners run longer so you can have a bigger profit in the end.
If you found this post informative and helpful, please give a like and or share. Leave a comment if you have any questions.
And until next time, good luck with your trading!
As I have discussed in my previous posts about the "imperfect" inverse relationship of DGD/BTC vs BTC/USD and the trading opportunity that goes with it.
To a certain extent, it has shown to move rather inversely compare to Bitcoin prices but it has shown that it's definitely not a perfect hedge against a huge dip/downward trend of Bitcoin or the overall market. So don't trade it purely as a hedging instrument/coin against a Bitcoin drop cause it simply isn't and made for that purpose.
But with that being said, there are definitely times/periods that you can see the inverse relationship and since DigixDAO made a bottom around $275 on March 14, it has bounced back considerably with volume back as before the downtrend.
So with DGD/BTC price going up and breaking $400 again, volume has gone up considerably as well, we also can see that the not so perfect inverse relationship of DGD/BTC vs BTC/USD slowly but surely coming back:
(BTC/USD in white candles)
Having the awareness of the inverse relationship is good for your trading but remember not to purely trade on this. Instead, know it's there but trade the underlying coin and its pattern(s).
DGD/BTC has been in a nice uptrend the last day or two and is now forming a sort of an ascending triangle pattern:
If you believe that DigixDAO can hold and continues its upward trend (with perhaps a further weakness in Bitcoin), then look to buy anywhere near the upward trendline in bright blue or wait for a break of the triangle and resistance at around 0.052000.
At the moment I rather go for the buy near the upward trendline approach cause it's closer to the trendline and could fall back a little more to touch the trendline before heading up again and since Bitcoin is moving up again. Taking this approach you'll also have more room for profits.
If not, you can always go for the triangle/resistance break and adjust your strategy and targets accordingly.
This is how you can trade DGD/BTC:
Trendline Continuation
Buy Area
0.046000 - 0.047000
Profit Target
1. 0.052000
2. 0.055250
3. 0.057800
Stop Loss:
0.044500
Triangle/Resistance Break
Buy Area
0.051500 - 0.052500
Profit Target
1. 0.055250
2. 0.057800
3. 0.059500
Stop Loss:
0.049900
Keep in mind that you can take profits at any time when you feel comfortable with or want to secure your profits. You don't have to wait for a target to be reached in order to sell.
And you can always sell a portion and let the rest ride longer. This will give you peace of mind and more patience to stay in the trade and let your winners run longer so you can have a bigger profit in the end.
If you found this post informative and helpful, please give a like and or share. Leave a comment if you have any questions.
And until next time, good luck with your trading!
Trade active:
Btw if you're not sure if this is the right moment to enter and go all in the trade but you don't want to miss out on a good trade or entry, you can "ladder" in or partially. For instance 1/3 of what you want to risk and if the trade goes your way, you can add/ladder in more. This way you don't risk that much and can be more patient with the trade if it doesn't go as planned and when it does go up, you confirm it and "feed " the trend with your buy orders.
Hope this helps.
Hope this helps.
Trade closed: stop reached