Bitcoin +25% in 9 days Post-Pump Consolidation Trading Strategy
I often have a hard time to feel comfortable trading after big moves, especially in the crypto market which we all know is like a gunfight in a dark room.
However usually those long moves we see a consolidation channel that is pretty clear, based on the market sentiment.
Before the 5k pump, everybody was skeptical and afraid, so the consolidation channel was sideways, and you could use pretty much the same strategy here and it would work perfectly there. Just sideways.
Now the market sentiment grew stronger, the small investors, like flies attracted to the light, desperate for any big bullish moves after a year-long nightmare are definitely buying in stronger.
This is easily seen by observing by going through social media and even looking at Tradingview's forecasts, suddenly now everybody is optimistic again.
In such madness I like to apply mathematical fool-proof methods, also to eliminate my emotional bias I use a neural network sentiment research and you can see how suddenly the market sentiment changed from the last months:
See Neural Network Bitcoin Sentiment Analysis for the last 7 days
It was far over 70% negative market sentiment 10 days ago.
Therefore, with a positive sentiment, people tend to buy more, thus the slightly bullish channel. So just adjust the channel accordingly.
I used a regression technique with a 1.2 standard deviation factor.
What we want is when the price moves out of the channel, the anomalies.
Then I use Spectro M2 Warning or XConf Reversal Arrow to get in.
I've been doing that with great success. So enjoy while it lasts.
Keep trading the channel until it breaks out, once it does, this strategy is no longer applicable.
This is crypto you never know when someone is going to dump so never trade without a stop-loss. I use a tight stop-loss ATR based. Have fun.
However usually those long moves we see a consolidation channel that is pretty clear, based on the market sentiment.
Before the 5k pump, everybody was skeptical and afraid, so the consolidation channel was sideways, and you could use pretty much the same strategy here and it would work perfectly there. Just sideways.
Now the market sentiment grew stronger, the small investors, like flies attracted to the light, desperate for any big bullish moves after a year-long nightmare are definitely buying in stronger.
This is easily seen by observing by going through social media and even looking at Tradingview's forecasts, suddenly now everybody is optimistic again.
In such madness I like to apply mathematical fool-proof methods, also to eliminate my emotional bias I use a neural network sentiment research and you can see how suddenly the market sentiment changed from the last months:
See Neural Network Bitcoin Sentiment Analysis for the last 7 days
It was far over 70% negative market sentiment 10 days ago.
Therefore, with a positive sentiment, people tend to buy more, thus the slightly bullish channel. So just adjust the channel accordingly.
I used a regression technique with a 1.2 standard deviation factor.
What we want is when the price moves out of the channel, the anomalies.
Then I use Spectro M2 Warning or XConf Reversal Arrow to get in.
I've been doing that with great success. So enjoy while it lasts.
Keep trading the channel until it breaks out, once it does, this strategy is no longer applicable.
This is crypto you never know when someone is going to dump so never trade without a stop-loss. I use a tight stop-loss ATR based. Have fun.
Comment:
A new channel is formed:
Comment:
Same strategy.
Comment:
Perfect signals with the updated channel. Still following it, heavy profits.
Perfect signals with the updated channel. Still following it, heavy profits.
I took profits at +30% :/