When prices go up, look for shorts. Here we trade 4H Ichimoku zones.
Orange zone is the first place to look for a short on OPUSDT perpetual contract. What should we be looking at in order to trade this idea? Simple, observe the reaction when prices hit the zone, use RSI divergence as confirmation.
- 4H close above the zone? - Higher high on RSI(14) on the 4H chart?
Then we don't trade this idea.
This set-up takes out liquidity above the previous highs. We might expect prices to fully penetrate the zone. Entry 2 gives you the best risk.
For our stop loss, we look for a resistance level above the zone. We identify a resistance level at 1.1450 USDT on the Ichimoku chart, indicated by the arrow (left hand side on chart).
For targets, we look at the current zone. Prices might break below 1 USDT, but lower take profits are less probable. We only take the high probability trade here, from level to level.
Set your alert on 1.115 USDT and trade the reaction of the zone. Happy trading!
Trade active
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There's our trade, like we expected. Zone penetrated, entry on second position for lower risk, stop above next resistance to avoid being stopped out.
Comment
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Because we were able to enter at 2nd position, top of the zone or 1.350 USDT, we took some profits at the bottom of the zone (1.120 USDT, or position 1). Profit to be added at position 2.
Once TP2 is hit, we move our stop loss to profit.
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We took profit on TP1. Part of the profit we add to sell position 1 (1.120 USDT) in case we test the zone again.
After taking our entry on sell position 2 (1.135 USDT) we took some profit on the bottom of the zone (1.125 USDT) and added this to sell position 2 again.
RSI seems to indicate momentum is decreasing. We only took this trade, and are willing to add our profits, because of bearish RSI deivergence. Should we test the zone again we could be in for a profitable trade.
Remember: this is just an idea, and NOT financial advice. Don't take this trade, as it might run into a loss. Only take trades that fit YOUR plan and/or risk tollerance. Happy trading!
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TP2 was hit.
We exited this trade at TP2. Our original idea was to move SL into profit once TP2 was filled. For that we look for a somewhat safe position just above TP1.
In this chart that would mean moving our stop above 1.0910 USDT. We would leave a lot of profit on the table being stopped out there, compared to the extra reward of staying in the trade for TP3.
We exit and look for new trades. Keep an eye on OPUSDT.P, the orange zone might give us a good trade again.
We set our alert 1.15 USDT and trade the reaction. Bey for now 😉
@SwallowPremium, Thanks, just starting out publishing on TV. Made Ichimoku cloud my own. Don't know anyone who trades like this so far, so I thought why not share my money maker. Have fun!