1. Analysis of ETHT/USD volume on Binance exchange.
2. Long-term trend analysis.
3. Medium-term trend analysis.
4. Short-term trend analysis.
5. Japanese candlestick analysis.
6. Conclusions.
7. Statistics.
1. Analysis of ETHT/USD volume on the Binance exchange.
In this analysis, we will use the data on horizontal trading volume from the Binance exchange on daily charts. The analysis is carried out based on the footprint-profile theory. According to the theory, the direction of the horizontal level with the highest trade volume within a day can indicate the likely direction of the trend. The level with the highest traded volume is the level where the maximum number of transactions has been made. This is the level of a major market player. Thus, if the maximum volume level moves higher, this indicates an uptrend. A downward movement of this level indicates a downtrend. A chaotic movement signals that the market is trading in a sideways trend.
15.02.21 – The level of the maximum traded volume (POC - Point Of Control) – 1699
16.02.21 - The level of the maximum traded volume (POC - Point Of Control) – 1751
The POC has moved up. The price is above the POC level. The market seems to start moving upwards, so you can open long positions.
2. Long-term trend analysis.
A trend is the trader's friend. Many market participants are aware of this saying. However, they do not know how to use it. The answer is simple: trade only in the direction of the trend. In this case, your trades will have more profit potential with less risk. The classic Dow Theory describes three main trends:
long-term;
medium-term;
short-term.
You need to analyze these trends before opening any trade. This is what we are going to do in the analysis below.
The long-term trend in this analysis is a daily trend. Trades will be made on the daily chart and held for several days. The analysis of the daily trend is carried out with the help of the EMA (48) - an exponential moving average with a period of 48. If the daily candle closed above the EMA (48), it means that we are facing an uptrend and should open long positions. If the daily candle closed below the EMA (48), it means that the trend is downward and we should open short positions.
On the chart, we can see an uptrend. The price is above the EMA (48). In this situation, it is recommended to open buy orders.
3. Medium-term trend analysis.
In this analysis, the medium-term trend is a trend on the four-hour chart (H4). The EMA (48), an exponential moving average with a period of 48, will also be used in the analysis. If the candlestick closes above the EMA (48) on H4, this means that the quotes are moving in an uptrend and we should buy. If the candlestick closes below the EMA (48) on H4, this means that we have a downtrend and we should sell.
The price is above the EMA (48). The medium-term trend is upward. Therefore, we should open long positions.
4. Short-term trend analysis.
In this analysis, the short-term trend is a trend on the H1 chart. It can show a point where we can enter the market. Here, we will again use the EMA (48) - an exponential moving average with a period of 48. If the candlestick closes above the EMA (48) on H1, this means that the quotes are trading upwards and we should buy. If the candlestick closes below the EMA (48) on H1, this indicates that the trend is downward and we should go short.
The price is above the EMA (48). The short-term trend is upward. The long-term, medium-term, and short-term trends coincide. Therefore, we should open long positions.
5. Japanese candlestick analysis.
The classic Japanese candlestick analysis is applied to the daily trading chart. In this analysis, we will also analyze the daily candlestick.
The daily candlestick closed downwards, the candlestick is black. Its high is above the high of the previous candlestick. The candlestick pattern is a hummer. Its lower shadow is long. Its upper shadow is long as well. A sideways movement is highly likely.
The daily candlestick closed downwards, the candlestick is black. Its high is within the previous candlestick. The candlestick pattern is a hummer. Its upper shadow is long downward movement is highly likely.
6. Conclusions.
Volume analysis: BUY
Long-term trend: BUY.
Medium-term trend: BUY.
Short-term trend: BUY.
Japanese candlestick analysis - SELL.
Conclusion: On February 17, you can open both long and short positions.
7. Statistics.
To analyze the effectiveness of this approach, we will keep the data on completed transactions. The forecast is made for four instruments: Bitcoin, Ethereum, Litecoin, and BCH/USD. Trading account monitoring: Trading account monitoring:
February 2021: +4.95%.
At the moment, we keep the position:
09.02.21 Ethereum BUY: 1781.35; SL: 1543; Risk: 1% of a $10,000 deposit with a trading volume of 0,42 lots.
Stop-loss orders for new trades can be placed beyond the daily extreme point. We do not set take-profit orders, as we will continue to move SL beyond the extreme points of the future sessions.
Since trading is carried out on the daily charts, this recommendation remains relevant throughout the day.
Trade along the trend and you will be able to make a profit!
