CRYPTO TRADING TUTORIAL: HOW TO READ BITCOIN CHARTS EPISODE#10


Hello, my name is Sean Vengan, and today is the 22nd of july
2017
Now the talk of the town is in the cryptocurrency world is all about the big 91
implementation and the user activated soft fork
Well, I’m not going to actually talk about that today because we don’t really care all we care about is the charts
and the charts tell us everything we need to know I
want to teach you how to make money from the charts and we do this by reading the charts and
Interpreting the charts the more knowledgeable you become in reading these charts in Advance
You can take advantage
What other people cannot see?
So let’s take a look at the charts there is lots of tips and tricks. I need to show you today
I hope you’ll enjoy them
you
Here we are on the monthly charts of bitcoin
We always start of the bigger picture the bigger picture will tell us much more information
than a smaller time frame chart
Now this is a line chart as opposed to a candlestick chart now
I want to put on the candlestick chart show you the difference between the two
With the candlestick there’s lots of noise going on here. There’s lots of lines going up lines going down
With the wicks it’s very hard to determine the real price action, but if we go on the line chart
It’s clear, and I’ll show you how clear it is if we use off your bonacci tool and go from this top
To this bottom over here
We can see that. This was a run-up, and this was a rundown and
currently we’ve
Approached the two six one eight area
and we’ve exceeded it, but this is in the area which indicates for me an
overbought area
So that’s the first thing to notice the next thing to notice is
This top over here. It was of great significance
And I’ll show you why that is
because if you draw a horizontal line here
you see that the market after hitting that top fell away and
It formed this
saucer Pattern over here and
Anyway, it broke the top it came back and retested it and then shot straight up
Now if we look on the weekly chart, this is more evident
Let’s just push this down again
okay, and
here’s the top and
After it broke it
We probably would have had our stop-loss there, and we would got stopped out
But the second entry allowed us to get in and make some profit over here using a trailing stop
We would have been a profitable trade
As it came down again?
it
Rested on that table, so therefore
This was a great buy opportunity, and you would have enjoyed a great run all the way up to here
So the lesson to take away is that look at previous tops and look for supports on those previous tops?
equally if it’s coming down you want to look at the bottoms and
see if there’s previous resistance on the bottoms, so
Just to make that clear
Although the price hasn’t come down here
When we’re in the position, and it does break this we will be looking on the underside of that line
For it to retest it and therefore this area here become a good sell opportunity
So this is one to watch out for so you know in advance
Where to look for in order to go short, and you’re streets ahead of other traders this will give you a huge advantage
Should there be a crash I?
Want to go back to the basics and the next lesson is that I want to establish. What is a trend?
Please first focus on the left hand side. Which is the upTrend ignore the right hand side
In order to be an uptrend. We must have a higher high and a higher low
higher High higher low
High high
Higher low this is an upTrend
Now we look at the middle section only and in order to have a downtrend. We must have a low or high and
a lower low
lower High
Lower low lower high lower. Low. This is a downtrend
in this situation here
We have a top we have a bottom and then we have a higher high higher high and we have a higher low
Okay, we sound as if we’re in an uptrend
But then what happens is that it breaks structure and it takes out that low
When it takes out this low, we don’t know where we are because we don’t have a lower high at this point now
We do form a lower high here
But in order to be a downtrend. What do we need we need a lower low?
Well, it doesn’t form a lower low. It comes within within this range here
So as you can see now we don’t have this nice neat upward
staircase
Uptrend, and we don’t have the down
walking down the stairs
situation
We have a mismatch of the two and this is a no trend, and we need to stay out
Now here you saw that we were in an uptrend we had a higher high and a high low
high high high low
High high high low, and then we broke structure and we had a low
We had a lower high
But we didn’t have a lower low
so we were in no-man’s land, so this was a no trading period
But at this point here
We had a lower high and we broke the low here. So now we have a lower low
So now this area here is a downtrend
Following this move the most most recent move was this strong run-up
What has this done to the structure? Well we had a
Downtrend and if you recall in the previous video. I told you two things
The first thing I told you to do was watch this area here
If you go back to the video you’ll see what I said on here. I said that
we had a
Low here and it bounced off it
We had another low which bounced off it
And then this time it broke the low and as it came back the buyers tried to step in again
And it went on the underside of that
resistance line
and I told you to watch for that resistance line because that’s going to be significant and
Sure enough it was significant because when it broke through that
That downtrend was over and if you recall I told you
that we were in a
Bear channel, this was Roughly the Bear channel
That was a bear channel that we were in and you can replay the video that I
Gave you on the last episode and once it broke structure of this bear channel
Then we went into no-man’s land. We didn’t have an uptrend and we didn’t have a downtrend and therefore we stay out
Now some Savvy Traders would actually trade this breakout
However, this is not for the faint-hearted and you can make as many losses as you can make wins unless you’re accomplished at
this type of trading technique
So in today’s analysis. We’ve established that there is no trend at the moment, and that’s a signal for us to stay out
But does that mean there’s no trading opportunity for us to take?
All there is there’s a potential flag setting up
And that is a tradable opportunity, so let’s examine that now
What we can see is we’re in a massive flag okay. This is a daily picture and
it’s forming a flag pattern over here and
A pole over here now if we just focus on that flag for the moment
We can now determine that we are in an area where?
We are hitting
resistance on the top of the flag and
This is the bottom of the flag we don’t know which way it will go so in short
We don’t know where we are at the moment?
We don’t know if we’re in an uptrend
And we don’t know if we’re in a downtrend and the best thing to do is stay out
But what we can determine if you want to if you really want to take a trade now
I would prefer not to take a trade here and not Force a trade
But what you can do is do a reversion to the mean trade. What does that mean well when it hits the top?
It comes back to the middle again, and when it hits the bottom it comes back to the middle again. You see here it
It hit the top and then it past the middle point, but it went to the bottom point
Then it went over here and it came back to the middle point
Came back to the middle point here it broke the middle point and went down to the bottom point
Here broke the middle point went to the top point, so if you wanted to what you could do is take a trade here
and
You can do this trade here. Let’s look. We can go here
So if you were to go short here
your stock could be above the top here and you’ll be looking to ride it to the
mean
Reversion point over here
That would be a risk to reward ratio of 1.5. Roughly
Now I wouldn’t take this trade for me my trades. I have to have a minimum of two to one
Risk reward in other words
I get two dollars back for every dollar I I trade but most of my trades are three to one in other words
I get three dollars back
For every one dollar I risk
So this is your choice whether you want to take this trade
I’m just on just for your reference. I I posted a
trade on
Aetherium and
Aetherium has a similar setup where we have a band
And we have a flag going on here
You see this is the mean point here. This is the upper Boundary
This is the bottom boundary so you can take a trade here
Go short your Stop-Loss would be above one of these tops over here
You’re looking for it to hit the mean reversion point, and that’s about 1.9
Or nearly to two-to-one in other words
You’re risking $1 to make $2 so you could take that trade if you wanted to
The final thing I want to have a look at is the us dollar the us dollar has been plunging
So here we have the picture of the us us dollar
Us dollar Euro and what we see here?
Is that there’s been some significant bottoms where the us dollar has hit and it’s currently
Literally on the bottoms here now whether this will provide support or not?
We’ll see but what we do see is this we see every reoccurring pattern
If we measure the distance from this low to this low here
Then we are able to either predict the next low or the next high in this case
This same equidistance produced too high over here. It was a few days out, but that’s what happened
Now this area here where we are predicting?
25th of september to be of some significance now will the u.s. Dollar quickly rebound and over here. I don’t know but
But what we do need to be aware of is how it affects bitcoin because as you see here
Bitcoin the usDollar are linked together
They are cross paired so we need to be aware of that
Finally I want to give you one last trading tip
I’ve traded Forex for many many years and what always happens. Is that there are news events and announcements?
So what I’ve done in my trading plan is I’ve reduced my position size
when it comes nearer and nearer to the news events as
We are aware we have the first of august deadline for the bip
148 and
this could have an effect on the markets, so if you trade A
Particular size what I would do is I’d reduce that to one third of your normal size
In this way, you’re not subject to the volatility and a potential heavy loss
Okay, that’s all I got for you today. I hope you’ve been
Informed and some of the trading techniques, I’ve use and which have made me money in the past I
Thank you for your time, and I look forward to speaking to you again
Take care for now. Bye. Bye

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