1.Analysis of bitcoin futures volumes from the Chicago Futures Exchange (CME)
2. Analysis of the long-term trend
3. Analysis of the medium-term trend
4.Analysis of the short-term trend
5. Japanese candle
6. Conclusions
7. Statistics
1. Analysis of bitcoin futures volumes from the Chicago Futures Exchange (CME)
The analysis uses data on horizontal volumes from the Chicago Futures Exchange on daily charts. The analysis is based on the Footprint Profile Theory in which the movement of the maximum volume level for the day can indicate the likely direction of the trend. The maximum volume level is the level at which the maximum number of transactions was made, that is, the level of a large player. Accordingly, the displacement of the maximum amount of levels up indicates an upward trend. Moving the maximum volume level down indicates a downward trend. The chaotic movement of the maximum volume levels indicates a flat in the market.
02/18/21 - The level of the maximum horizontal volume (ROS-Point Of Control) - 52140
02/19/21 - The level of the maximum horizontal volume (ROS-Point Of Control) - 53020
The ROS has moved up, the price is above the ROS level. The upward movement continues so you can buy.
2. Analysis of the long-term trend
A trend is a trader's friend. Many traders know this saying but they do not know how to use it. The answer is simple: You just only have to simply trade in the direction of the trend. This way your trades will have more profit potential with less risk. According to the Classical Dow Theory, there are three main trends:
- long-term
- medium-term
- the short-term
It is all these trends that need to be analyzed before opening any transaction. We will do this with this analysis.
The long-term trend in this analysis is the daily trend. Trades will be made on a daily time frame, and will be held for several days. The daily trend is analyzed using the EMA (48), an exponential moving average with a period of 48. If the daily candle closes above the EMA (48), it means that we are facing an uptrend and should buy. If the daily candle closes below the EMA (48), it means that the trend is downward and should be sold.
The chart clearly shows an upward trend that the price is higher than the EMA (48) so in this situation it is worth considering purchases.
3. Analysis of the medium-term trend
In this analysis, the medium-term trend will be the trend on the 4-hour chart (H4). The EMA (48), an exponential moving average with a period of 48 will also be used for the analysis. If the H4 candle closes above the EMA (48) so it means that the trend is upward and you should buy. If the H4 candle closes below the EMA (48), it means that the trend is downward and should be sold.
The price stays above the EMA (48). This means that the medium-term trend is upward and coincides with the long-term trend, so you should buy.
4. Short-term trend Analysis
The short-term trend, which can well show the entry point to the market will be considered a trend on the H1 timeframe. The EMA (48), an exponential moving average with a period of 48 will help us. If the H1 candle closes above the EMA (48), it means that the trend is upward and you should buy. If the H1 candle closes below the EMA (48), it means that the trend is downward and should be sold.
Price per EMA (48). The short - term trend is sideways. Long - term, medium-term and short-term trends do not coincide, you can buy and sell.
5. Japanese Candle Analysis.
The Classic Japanese Candlestick Analysis is used for the daily timeframe. In this analysis, we will also analyze the daily candle.
Closing the daily candle up, the candle is white. Extremes outside the extremes of the previous candle. The shape of the candle is a hammer pointing upwards so it's probably an upward movement.
6. Conclusions
Volume analysis - BUY.
Long-term trend - BUY.
Medium-term trend - BUY.
Short-term trend - BUY SELL.
Japanese Candlestick Analysis - BUY.
General conclusion: 02/22 / 21- you can buy and sell.
7. Statistics.
To analyze the effectiveness of this approach, statistics on completed transactions are kept. Forecasts are made and transactions are made on four instruments: Bitcoin, Ethereum, Litecoin, BCH USD. See other articles. Monitoring your trading account:
The result for February 2021 is + 11.34%.
Regulation:
We are in this transaction:
02/18/21 Bitcoin BUY: 51678 SL: 53530; Risk per transaction: 1% of the deposit. With a deposit of $ 10,000, the lot is 0.03.
We moved the stop loss for the minimum of yesterday. For new trades, the stop loss is located behind the daily extreme. We do not set a take profit as we will accompany the transaction by moving the stop loss beyond the extremes of the new days.
Since trading is conducted on daily charts, this recommendation is relevant throughout the day.
Trade on the trend, and you will have a great profit!
