how to generate bitcoin trading strategies in EA Studio

How Do I Create Bitcoin Trading Strategies with Software?

Generating 100s of trading strategies for Bitcoin

Hello everyone, in this lecture, I will show you how to generate hundreds of trading strategies for Bitcoin. To achieve this, I will use EA Studio, which is a strategy builder software that we use most in the Academy.

As I’ve said many times in other lectures, EA Studio has a tool called Generator. The Generator can use the historical data that you import from your broker or the Premium historical data that is bundled with EA Studio. In this case, I will use the Premium Data that comes directly from the Forex Historical Data app. And I made it work for the Hot Forex broker which I am using at a moment for Bitcoin trading.

In the Historical data section, I have also the Symbol, which is the currency pair that we’re trading with. Since I want to generate trading strategies for Bitcoin, I will use the BTCUSD symbol. Finally, I have the Period, from where I can select on what timeframe the strategy will trade.

So if I just click on the Start button, you will notice the high speed. This is the fastest Generator for strategies. In just a few seconds, I have over 60 trading strategies. And these strategies all go to the Collection tab automatically.

EA Studio Generator interface
Generating Bitcoin trading strategies in EA Studio

If I click on the Collection, you will see that the Bitcoin trading strategies are listed there. And I have many pages, each containing 10 strategies.

Collection of Bitcoin trading strategies
Collection with trading strategies for BTCUSD

Now, obviously, I don’t want to have some random and simple Bitcoin trading strategies. So I will stop the Generator and I will delete all of these trading strategies. But before actually deleting them, I will click on one of the strategies and I will show you what tools we have in the Strategy section.

How to optimize Bitcoin trading strategies

We have Optimizer and Normalizer. The Optimizer is very similar to the Optimizer that we have in MetaTrader. So if I just click on the Start button in the Optimizer, it will look for better parameters. It didn’t find any in this case, but it will look for better parameters with the trading strategies.

Using EA Studio Optimizer for a Bitcoin trading strategy
Optimizer in EA Studio

Now, optimizing a trading strategy sometimes is very risky because you can over-optimize it. In other words, you will find the best parameters but just for the tested period.

Usually what happens with such strategies is after you start trading, they start losing. Just because you have found the best parameters exactly for the period you are testing. And these are not robust strategies.

Normalize the Bitcoin trading strategies

The next tool we’re going to use when generating our Bitcoin trading strategies is the Normalizer, which is a unique feature of Expert Advisor Studio. It normalizes the strategies, reduces the Stop Loss, the Take Profit if you’re using. In other words, it pushes the parameters to the default parameters.

The Normalizer

Using Walk Forward and Monte Carlo

Then we have the Walk Forward, which is a little bit more advanced tool.

If I click on Start, this tool optimizes the trading strategy for a certain period of time. Then it tests the strategy on the next period, includes that period, and optimizes again, and tests the strategy again.

You can see that it found a much better result, which means that it found a better strategy.

Walk Forward finding a better trading strategy
The Walk Forward

We have the Monte Carlo, which is my favorite instrument among the robust instruments. So, Monte Carlo, Multi Market, and Out of Sample Monitor are robust tools. They don’t change the strategy like the Optimizer, Normalizer, and Walk Forward, but they test the strategy if it is robust or not.

With the Monte Carlo tool, I can test with random historical data, random spread, random slippage, random position entry and exit, and randomly closed position.

We have Strategy variations, which is the option I use the most. This will simply test the strategy with different indicator parameters. And I like to use “Randomize backtest starting bar”, which will backtest the strategy from different bars or from the different starting points. In addition, it is not a bad idea to check “Randomize spread” because as we saw with Hot Forex and with most of the brokers, the spread is floating.

The Monte Carlo

So sometimes your position will open on a $24 spread, sometimes $25. And if there is volatility, it might be even more. So if I click on “Start”, it will perform 20 tests and I see that just 13 out of the 20 were validated. Which is not enough for me. I like to have at least 18 or a minimum of 16 out of the 20, which is 80% of the tests to be validated. That is something I always use.

Testing different markets with Multi Market

Then we have Multi Market where we can add different markets.

The Multi Market

For example, I can add Bitcoin, Ethereum, Ripple, or any other cryptocurrency that I have as historical data and I can check if this trading strategy works well on the other markets.

And as well, I have the Out of Sample, which I will explain just in a minute.

Using the Reactor to generate Bitcoin trading strategies

Now the best thing with EA Studio that was improved during the years is that we don’t have to do all of that manually anymore. I just went over it to demonstrate what we were doing before. We were generating strategies, they were going to the collection after that, if I like any strategy, I was going through Optimizer, Monte Carlo, Multi Market one by one. Understand what I mean?

It was taking time because I had to do it manually for each trading strategy. Now, we don’t need to do this anymore because we have the Reactor. Right under the Generator is the Reactor.

Using the Reactor to generate Bitcoin trading strategies
The Reactor

If I go to Generator, we have historical data, strategy properties, and Generator settings. And if I click on the dropdown arrow after Generator and switch to Reactor, here we have the same things plus optimization and robustness testing.

So what the Reactor does is it passes all the strategies through this testing automatically and I don’t have to do it by myself manually.

So I will remove all the strategies in the Collection. I will switch to the Reactor and I will just set it very quickly so you know how I’m using it.

Now in the Reactor, I will go for Bitcoin on the H1 hourly chart. In the Strategy properties section, I will set Entry lots to 0.01 because this is the minimum quantity I can trade. And I would suggest you always start with 0.01, especially if you are generating Bitcoin trading strategies because this way you will just test the Expert Advisors.

You won’t risk a lot if you try them on your Live Account. And I don’t like to stimulate and motivate my students and traders to use huge volumes or big accounts. That’s a personal choice how much you want to trade. One more time, changing the lot doesn’t change the Bitcoin trading strategy or the Robot. It changes just the result.

Should you use Stop Loss and Take Profit

Then I have the option to select if I want to use Stop Loss or Take Profit. I will not use Stop Loss and Take Profit.

First of all, I have done many tests with EA Studio generating Bitcoin trading strategies with Stop Loss, without Stop Loss, with Take Profit, and without Take Profit. I don’t have 100% proof that one of the two works better.

So if I include Stop Loss, let’s say I will be using a Stop Loss somewhere between 1 000 and 10 000 pips. Now, if your broker has 2 digits (the broker I’m using for this lecture has 3 digits), if I set a Stop Loss, let’s say $100 or $200, then if you are using more or a few digits, the Stop Loss will change. It will become either a $1000 or it will become either a $10.

Setting the Bitcoin trading strategy properties in the Reactor
Setting the Bitcoin trading strategy properties in the Reactor

And that is another thing that I have improved from the previous version of the Bitcoin Algorithmic Trading course where I was including Expert Advisors with Stop Loss and with Take Profit. Some of the students were like, “why don’t the EAs work with my broker” or “why do I see very huge Stop Loss and very huge Take Profit“.

And others were just fine because they were matching the digits with their broker and my broker. That is why when we are talking about Bitcoin, I do not use Stop Loss and Take Profit.

And for the beginner traders, these are automated levels where the position will close on a loss or it will close on a Take Profit.

But if you don’t have a Stop Loss and Take Profit, the strategy will simply exit based on the exit condition. There will be an indicator inside. So no worries if you don’t have Stop Loss. The trade still closes when the exit condition is there. And many traders say that it is better to trade without Stop Loss and Take Profit. One more time for me, I don’t have a 100% statement to say, is it better without or is it better with.

That’s why in the course I include Bitcoin trading strategies that are created without Stop Loss and Take Profit. So we will depend on the entry rules and on the exit rules. But you can test, of course, generating Bitcoin trading strategies with Stop Loss and with Take Profit.

Setting the generation time period in Generator settings

In the Generator settings section, I have the working minutes, so I set it to 1 hour and you will see how many Bitcoin trading strategies it will generate in 60 minutes. Usually, I leave the Reactor working for 10 hours, which is 600 minutes, and this way I leave it overnight and actually right now I’m recording late in the evening, so I will leave it to 600 minutes because I want to get more and more Bitcoin trading strategies.

When we generate for a longer time, it doesn’t mean that we will get better strategies. We will just get a bigger number of strategies. And in the Collection, we will see always the top strategies. The longer you run it, the more chances you have for finding better and better strategies.

Then for Search best, I will leave it the way it is – Net balance – so, at top of the Collection, I will see the Bitcoin trading strategies that have the most profit.

Using Out of Sample (OOS)

I will select 10% Out of Sample and what that means?

If you remember, the Out of Sample Monitor divides the whole backtest period into different zones.

Out of Sample monitor

So if I have 30% Out of Sample, this means that the Generator will use 70% of the historical data to generate Bitcoin trading strategies and it will simulate trading on the last 30% of the data.

Now, if I switch to 10%, this means that the Generator will use 90% of the time. And for the last 10%, it will simulate trading. And in our case, with the historical data that I have, this will be from the 3rd of August until December.

So for a little more than 4 months, it will be just a simulation of how these strategies would perform if I have placed them for trading on the 3rd of August.

The MACD Indicator

But actually, I won’t be testing them on a Demo Account or a Live Account, the strategy builder will do this simulation. And this is one of the methods to avoid over-optimization because I will just choose the strategies that are profiting in these last 4 months.

So going back to the Reactor, I will use Out of Sample 10%. For the Max entry indicators and Max exit indicators. I will leave it as it is.

The Generate strategies with preset indicators setting will be suitable if you have some favorite indicators. For example, let’s say you like the MACD Indicator and you want the MACD in every strategy, you can check that, when you click on it, you will go to Preset Indicators in Tools and then you can add MACD or any other indicator. Then this MACD indicator will be in all of your trading strategies.

Setting preset indicators in EA Studio
Setting preset indicators in EA Studio

But I don’t usually do that. I want the Generator to show me which are the best combinations between different indicators.

How to use the common Acceptance Criteria

Make sure to set a checkmark before the Use the common Acceptance Criteria.

We need to use it. This is where we set some criteria. For example, I will select that I want to have a minimum of 500 counts of trades for every strategy or for every Robot.

Setting a checkmark before the Acceptance Criteria
Generator settings

Now, with time I found out that the more count of trades we use the more robust strategies we have.

Because imagine you have a backtest just with 20-30 trades or you have the Bitcoin trading strategy executing just 20 or 30 trades for the last 3 years. I guess you wouldn’t be happy trading such a strategy.

But having 300, 400, or over 500 trades that happened for the last 3 years, and the strategy is profitable, you will know that this is a robust strategy and you can depend on that strategy for the future. Because if it executed 500 times the same rules and it kept being profitable, then there is a higher chance that the strategy will keep being profitable in the future.

The minimum profit factor of 1.2 is just fine.

The profit factor is the net profit divided by the net losses.

You can add any other criteria, but I will stick to the Minimum count of traders and the Minimum profit factor.

And as well, we have the option to set criteria, for In Sample part which in our case will be the 90% zone. And I will go to the profit factor again, but I will decrease it just to 1.1. I will remove the net profit, no net profit. Obviously, on the top, we will see the strategies that have the most net profit.

So Minimum profit factor is 1.1, and this is the Acceptance Criteria that I will be using while generating the Bitcoin trading strategies.

Setting the The common Acceptance Criteria in EA Studio
The common Acceptance Criteria

So what happens now?

The Generator will produce strategies on Bitcoin, on the hourly chart without Stop Loss and Take Profit. It will generate the strategies over 90% of the historical data. And for the last 10%, it will test them, it will simulate trading and it will pass only the Bitcoin trading strategies that fulfill the Acceptance Criteria. Only the strategies that have more than 500 trades and that have more than 1.2 as a profit factor and that have more than 1.1 in the In Sample and in the Out of Sample.

Avoid optimizing strategies

I’m not going to use Optimize strategies settings because it is risky to over-optimize the strategies.

With my experience, I know that the Generator finds good enough combinations between indicators and parameters, so no need to optimize them and to look for better parameters. That’s personal, in my opinion. So in this lecture, I’m just showing you how I use the Reactor by myself to generate 100s of Bitcoin trading strategies.

And below we have the robustness testing tools. I will leave the Monte Carlo test, meaning that at least 16 out of the 20 tests, or 80%, from the Monte Carlo, should be true.

And if the Bitcoin trading strategies from the Generator pass the Acceptance Criteria, they will go through the Monte Carlo. If they go through the Monte Carlo, we will see them in the Collection.

We will see the number of strategies that are generated. How many pass the validation and how many trading strategies pass the Monte Carlo? And if the strategy passes everything that I’ve said, it will go into the Collection.

Number of Bitcoin trading strategies generated

And one last thing I wanted to mention, if I click on tools and I go to settings, I set it usually to close the trades at Friday close or at Friday to close all trades by 9:00 PM.

Different brokers close at different times on Fridays. Some will close at 10:00 PM, others at 11:00 PM, others at midnight. I put it at 9:00 PM. So it doesn’t matter what your broker uses as a closing hour, I want to make sure that you will not have trades left behind for the weekend.

Setting the trading session time in EA Studio
Setting the trading session time

Now, I will return to the Reactor and I will click on Start.

Again the generation process is very fast but you can notice the difference. Not so many Bitcoin trading strategies are going into the Collection now. Only 1 has passed everything. And it went in the Collection. You see a very nice equity line and as well, the Out of Sample test is profitable.

The Bitcoin trading strategy in the Collection
The Bitcoin trading strategy in the Collection

So what I will do? I will leave the Reactor running for 600 minutes, which is 10 hours. Something else that I will do right now is to open the very same EA Studio on the other 2 browsers and I will generate strategies at the same time for M30 and for M15. And not just on different tabs, but on separate browsers, because this way the software works faster.

This is one of the things that I liked most the first time when using EA Studio. You can run multiple Reactors on your computer on different browsers.

I will leave it now for H1. Then I will open 2 more browsers actually for M30 and M15. And in the Bitcoin Algorithmic Trading course, I show you how many Bitcoin trading strategies I have generated and what strategies we will have in the Collection.

Thank you, guys, for reading. I hope this lecture will be useful to you and will help you to understand how to generate simple and complex Bitcoin trading strategies in less than a day using the EA Studio strategy builder.

If you have enjoyed the lecture, share it across social media or just leave a comment below to show your appreciation.

I will see you in another lecture.

crypto trading software

Crypto Trading Software -The Smart Way To Automate Your Strategies

Why use crypto trading software

In this lecture, I will share with you how to use crypto trading software to create strategies and use them to trade with the major cryptocurrencies. You will see how easy it is to automate the strategies with one click and use them for trading with Robots on MetaTrader.

Here in the Academy, we use Expert Advisor Studio, which is one of the best strategy builders on the market. EA Studio is suitable for both beginner and advanced traders, interested in Forex, cryptocurrencies, stocks, and even gold trading. If you haven’t watched the free EA Studio Basics course yet, you can enroll here.

So, in EA Studio we have 2 options. The first is to generate strategies using the historical data that we have prepared, and the second is to build the strategy.

So if you have a strategy for any trading asset, let’s say Bitcoin, and you have your rules for the strategy, you can add them here.

Adding a rule in the crypto trading software
Adding a rule

Using multiple indicators

For example, I can add a rule. Let’s pick any of the Indicators, RVI, or let’s take the RVI Signal and for RVI Signal, we have a few entry rules. RVI line crosses the Signal line upward, RVI line crosses the Signal line downward, RVI line is higher than the Signal line, RVI line is lower than the Signal line.

RVI entry rules

I will select RVI line crosses the Signal line upward, the first one on the top and I click on Accept and you see that I have a Balance chart immediately, which is obviously losing.

The balance chart

But we cannot have a trading strategy just based on 1 indicator.

The best results are coming when we combine trading indicators.

So that’s why I will add as well an exit condition. And let’s grab now the RSI, which is one of the most popular indicators in trading. And again, we have a few more options here. RSI rises, RSI falls, RSI is higher than the Level line, RSI is lower than the Level line, RSI crosses, RSI changes. And the one I will be using is RSI crosses the Level line downward. This one right here. Then I click on Accept.

The RSI

Improving the strategy

And look at that, we already have a profitable strategy.

The balance chart changes

That’s the Balance chart. So the account starts at 10 000. This is how it is set in the Tools and Settings. You can change that in the crypto trading software. I will show the settings in EA Studio a little bit later, but you will see that already from the two indicators.

We have a Balance chart and the best thing is that we see it at the moment. I don’t need to test this strategy on MetaTrader, but I see the backtest straight away, right after adding the indicators, and I can play a lot with the strategy to improve it. So for example, in the RVI period, I can increase it to 20. Let me see if that will be better. Not really.

I will go to 30. That’s a little bit better. But I see a huge drawdown in the middle. I will go to 40. No, not really. Let’s change the RSI. I will increase the Level line for example to 40 and the period I will go to 30, click on accept, not really.

Having the right parameters for the strategies

Let me decrease a little bit the period and I will increase it a little bit the level. I click on Accept, which improved the strategy a little bit. Now I will start increasing as well, the RVI, I click on accept, let’s go to 3, accept, we have a much better result.

I have hundreds of options actually for parameters, and especially if I use a few indicators.

It is really, really hard if you don’t have a strategy builder or crypto trading software to find out which are the best parameters for the strategies.

The good thing is immediately, right after we do a change, we see the results. Let me try increasing it one more time. Now, I think with 43 it has a much smoother equity line.

It depends with the amount and strategy to trade with

As well, we have Backtest output.

The backtest output in EA Studio
The backtest output

Net profit is 12 599 for the tested period. So the data starts from the 23rd of May 2017 and it is until December 2020. And we have a profit per day, $2. But actually, that is trading with 0.1.

If I increase it, for example, with 1 lot and I click on Accept, you will see the same equity line. This doesn’t change the strategy but it changes the result. As well, you can add Stop Loss and Take Profit if you want to.

And of course, you can decrease the lot to 0.01, it depends on the amount you’re starting with.

But one more time, this doesn’t change the strategy. It is the same equity because we have the same rules for the strategy. So it really depends on how much you’re starting and how many strategies or Expert Advisors you will be trading with.

Hiring developers vs. Using software for crypto trading

So once you’re ready with the trading strategy, here is the magic. In the upper right-hand corner of the crypto trading software, you can see Expert Advisor as shown below. If I click on it, I have the option to export this strategy as Expert Advisor for MetaTrader 4 or for MetaTrader 5. Let’s click on Expert Advisor for MT4.

exporting a crypto trading strategy in the software
How to export the strategy

Immediately, I have the code exported and that is the ready to use Expert Advisor.

Here is the code.

The code

So if you are a developer, you can I guess change something, modify, improve or remove something. I personally do not touch anything in the code because I’m not a developer. I don’t know how to do it.

In the past, I used to hire developers to automate my strategies, but it was a very hard process because it is expensive to hire such developers. First, these guys take a lot of money, and second of all, it was taking a lot of time.

Doing a backtest on MetaTrader

Such a strategy at that time, that was about 4 years ago, I think, I was paying over $100 for such a simple strategy with 2 Indicators inside. And then there was always a problem with the strategy, with the code.

So I had to send it back to the developers and they were sending me the fixed version and sometimes it was taking a few months to have the final version of the strategy. But even when the Expert Advisor was complete, I didn’t have that type of statistic like in the crypto trading software. Backtest output, Balance chart, Indicator chart.

You can do a backtest on MetaTrader, by the way, but we don’t have so many details like in EA Studio. For example, if I click on the Indicator chart, I can see exactly where every trade was opened and where every trade was closed.

Sell trade

So one more time, the entry rule for this crypto strategy is the RVI line crosses the Signal line upward and this is when we want to Buy. And when we want to Sell it will be the opposite thing. And for the Buy, the exit is when RSI crosses the Level line downward. So if I click one more time on the Indicator chart in EA Studio, you can see below that I have the Sell trade right after the RVI crosses the Signal line downward in this case.

The indicator chart in Expert Advisor Studio
The indicator chart

That’s why I have a Sell trade. I have a Buy, the RVI crosses the Signal line upward. So we can see very clearly where all trades were opened and closed.

And using this crypto trading software long enough gave me a great experience and knowledge about how Expert Advisors actually work and when they open trades.

Drawbacks of MetaTrader

And the bad thing with MetaTrader when you are looking at the Indicators is that they are repeating. Sometimes you might not see a cross. For example, at one point it looks like the lines are just touching and it’s really hard to say are they crossing or not.

And when the price changes, the cross might not be visual, but the strategy builder knows that precisely because we have all these values of bar opening, closing high and low, which we said comes from the historical data that we have imported. There is no mistake here. What happened?

It’s 100% accuracy and actually, that is something that is not possible for the human to recognize and to calculate. And one more time, there are hundreds of trades, for example, with this strategy. 506 trades executed for the tested period.

Looking for trades through charts will mislead you

So imagine if you have to go through MetaTrader or any other platform to put Indicators and to follow. Here, I will Buy. Where will be my exit? Where the RVI crosses? Will you see it? I see how close are the 45 and 55 levels in this case. And then this is my next entry. Where is my exit? What happened? Am I Buying?

So for example if you are Selling here and if you start from that moment, are you Selling, do you know if there is no trade already opened at this moment? You don’t know that. We don’t know.

I don’t know, personally, even I have a lot of experience, I know that if I go through the charts and try to look for the trades, it’s wrong. It’s a mistake. Many people do it, but it will mislead you with the results.

How to build a strategy

The only way to do it is with the backtest, such as this one with EA Studio. There is another software that can perform the backtest – the Forex Strategy Builder Professional. And MetaTrader also has a backtest, but it’s not that reliable as the one that we have performed in EA Studio. We have the Balance chart where we see exactly the balance for this strategy.

In the crypto trading software we have a Journal where we see all trades that are opened and closed for that period of time.

The journal in the crypto trading software
The journal

We have a lot of statistical information. Balance chart, Count of entries by weekdays, Profit and loss, Backtest output. But it’s a lot of information that you can find below and that shows a lot more about the strategies.

So this is how you can use EA Studio software to build your own crypto trading strategy and export it as an Expert Avisor robot for MetaTrader 4 or MetaTrader 5.

In one of my courses about crypto trading, I show how I’m using the Generator. And you will see that even if you don’t have such a trading strategy and you don’t know how to build a strategy, you can use the Generator, which will produce hundreds of strategies based on the historical data that you have prepared.

And if you don’t have historical data, if you don’t know from where to start, you can go just straight away with the premium data in EA Studio software, which is the very same data that I’m using for crypto trading. All I did is I changed the spread, the swap to make it work for HotForex, the broker that I’m using at the moment for Bitcoin trading.

If you enjoyed this lecture, feel free to share it across social media so more users can learn about EA Studio crypto trading software. See you in the next lecture.

how to buy Bitcoin

How to Buy Bitcoin with Credit Card, Cash, and PayPal | PROs & CONs

How to buy Bitcoin with a credit card

There are different payment methods that you can use to purchase Bitcoin or another cryptocurrency. The most popular one is to buy Bitcoin using your credit card or debit card. And the good thing is that usually the purchase is instant and you buy the assets at the current price.

showing how to buy Bitcoin with credit or debit card on Coinbase
Debit card or credit card purchase

The downside of buying Bitcoins with your credit card is the fact that most of the exchanges will charge you relatively higher fees. Now, by the time I’m recording this lecture, the fees are somewhere between 1.5% and 5%. So 5% as a fee is not small when you buy Bitcoins.

But there are times when I prefer to buy with my credit card. Because I want to catch a nice movement from the Bitcoin and I will tell you why.

How to buy Bitcoin with cash

The second option is to buy Bitcoin with cash via a wire transfer. With the wire transfer, usually, we pay much a lower fee, but it takes a few days for the money to arrive and it could take up to a week.

you can buy Bitcoin with cash via wire transfer
The wire transfer

Depends on where you live, from which crypto exchange you purchase, and so on.

And now keep in mind the following. The price for the Bitcoin went from $20,000 to $30,000 very quickly for a few days and after that from $30,000 to $40,000. When I was buying Bitcoins at that moment, I decided to use my credit card and I paid on some of the exchanges 2%, 3%, up to 5% as a fee.

But if I used a wire transfer to buy Bitcoin with cash at that moment and the money would arrive in a few days, then the price could be much higher than 5%. If the Bitcoin rises by 10% until your wire transfer arrives, then you would be buying it at a much more expensive price. You’d better pay the 5% fee and buy Bitcoin with a credit card. When the money arrives, this is when they will lock the rate.

Whether you are purchasing a huge or small amount

You sent your money with a wire transfer, which is the cheapest option, but it could turn out that it’s not cheaper if the price goes $5,000, $10,000 in a few days. And we saw already that this is possible with Bitcoin. But at the same time, there are some exchanges like Coinbase where you can send the wire transfer to your EUR wallet or USD wallet, for example.

This means that I will be sending money into my Coinbase account. I will not be purchasing any cryptocurrencies. The money will arrive there. And then from there, I have my EUR wallet, for example, personally because I’m in Europe and with these EUR, I will be purchasing Bitcoins or other cryptos whenever I decide.

Now, to summarize it, if you are buying a small amount of cryptocurrency, it’s better to use a credit card or a debit card. If you are purchasing a huge amount, the wire transfer would work. But there you take the risk that you don’t know where the price will be in a few days.

And how I do it personally? If I see the Bitcoin is very aggressive, for example, going from $20,000 to $30,000, from $30,000 to $40,000, and I want to buy it immediately, I use my debit card.

when to use debit card to buy Bitcoin
When I use my debit card

But if I just want to put money into my Coinbase wallet to have capital that I will be using in the future to buy and sell, then I would prefer to use the wire transfer. And I’m not immediately buying, I’m just funding my account, which I will be using in the future.

The PayPal option to buy Bitcoin

Now, the last option that comes very popular recently is PayPal. They announced in 2020 that they will provide cryptocurrencies. For the moment the option to buy Bitcoin with PayPal is only for U.S. customers.

But as soon as it becomes available in Bulgaria, for sure, I will take advantage of that. Because it would be really awesome for me to be able to buy cryptocurrencies using my PayPal account. Because currently, the exchanges are not very friendly when it comes to PayPal.

Check the payment methods before when choosing from where to buy

With Coinbase, I have the option to withdraw via PayPal. But I don’t have the option to purchase Bitcoins with my PayPal account. And this changes all the time. I’m just giving you the PROs and CONs when you are using your credit card to buy Bitcoin. This means higher fees, while wire transfer fees are lower but it takes a few days.

Buying cryptocurrency with PayPal will become popular in the near future. Actually, when they announced in 2020 that they are offering cryptocurrencies and this pushed Bitcoin higher.

So before you decide which exchange you want to use, make sure that you check the different payment methods they offer.

And, of course, with time the exchanges try to provide more and more options to their clients. Because obviously, they profit when we use the exchanges. They want to offer the clients a variety of different payment methods.

Check of your bank allows you to buy Bitcoin

So it will be easier for people to purchase and invest in cryptocurrencies. Of course, if your bank blocks that, that’s a different story, you really cannot do a lot. And as I’ve said, I had a lot of hard times when actually my bank blocks the purchase. And I just failed to send the money and I cannot buy and cryptocurrencies. That was very hard back in 2017, but now it got a little bit easier in Bulgaria. So it really depends where you are.

It would be best if you first check if your bank allows you to buy Bitcoin, what are the methods that you can use. Or if you have a credit card, that would be the easiest way.

As I’ve said, the best thing is just to test with a small amount if it will work for you to purchase to withdraw back the money into your account. So you will feel comfortable and you won’t worry that you will not be able to withdraw your money.

Thank you for reading the lecture. If you have any questions regarding the buying of Bitcoin with a credit card, with cash or via PayPal, just leave a comment bellow. I will see you in another lecture.

Buy Bitcoin or Ethereum

Buy Bitcoin or Ethereum: Choose the Right Crypto at Any Moment

Should I Buy Bitcoin or Ethereum?

Hello, investors, in this lecture, I will tell you how you can decide at any moment if you should buy Bitcoin or Ethereum, or any cryptocurrency instead of another.

I will try to make it very clear and easy for beginners or even advanced investors and traders to decide what is better- to buy Bitcoin or Ethereum, or Litecoin, or any other assets on the cryptocurrency market.

Bitcoin price speculations on YouTube, or Reddit, or any other social platform

I know there are a lot of YouTubers, a lot of predictions, a lot of posts on Reddit, especially after Bitcoin broke the $20,000.

youtubers predicting the price
There’s a lot of prediction online

There are a lot of people saying that Bitcoin will reach $100,000, it will reach $450,000, it will reach $1,000,000. The truth is, nobody knows that. Nobody knows if Bitcoin will reach $1,000,000. Nobody knows if Ethereum will reach $20,000. It’s a lot of speculation.

All the YouTubers and all the articles that are being written are because they want to get more traffic and they want to make their articles and their YouTube videos sound like, “it will reach a $1,000,000“. Well, we don’t know that.

You cannot find a single video on YouTube or anywhere, or a single post before 2017 with a prediction where someone is saying that the price will reach $20,000, it will crash to $3,200. It will reach $14,000 almost. It will crash because of the coronavirus and then it will break $40,000.

There is no such a video over the Internet, no blog post, no article, nothing like that because nobody knew that and nobody knows what will happen in the future. That’s why I never do such predictions, because I will mislead a lot of my followers, a lot of my students, and I don’t want to do that.

Making decisions on how to buy Bitcoin or Ethereum

So I guess the most important question comes to how you decide at every moment whether it is better to buy Bitcoin or is it better to buy Ethereum, or Steller, or Litecoin, or any other cryptocurrency.

And there is a super easy solution that I use and I find it most appropriate and logical.

For example, let’s say we decide if we should buy Bitcoin or Ethereum. Right now I have the Crypto.com exchange, which I will make on a huge screen, and I have selected Ethereum versus Bitcoin. It’s a pair, Ethereum versus Bitcoin. Now, for the very beginners, Bitcoin price is Bitcoin versus American Dollars.

compare buy bitcoin or ethereum or other cryptocurrency
Bitcoin price

It’s a pair. Just like with the Forex pairs EURSD, GBPUSD, EURGBP, it is a currency pair. But with cryptocurrencies. Many of the crypto exchanges offer us not just with the US Dollar. But it could be a pair between different coins, for example, Ethereum versus Bitcoin, or Litecoin versus Tezos, or any other pair.

And the current price of Ethereum versus Bitcoin by the time I’m writing the lecture is 0.03 something, which means that you can buy 1 Ethereum for around 0.03 Bitcoins.

So how that would be useful to you to decide whether you should buy Bitcoin or Ethereum?

Now, if you look at the chart from June 2020 until September 2020, so between June 2020 and September 2020, the Ethereum Bitcoin pair goes upwards, which means that the Ethereum is stronger compared to Bitcoin its good to buy Ethereum during this time. Then from September down to December 2020, it was the better choice to buy Bitcoins instead of Ethereum. And this was the time when I bought most of my Bitcoins in my crypto portfolio.

Ethereum versus Bitcoin

And then after December or now I’m recording this lecture in January 2021, Ethereum is actually much stronger than Bitcoin. It just rises much faster compared to Bitcoin.

Bitcoin is in kind of consolidation, it brought the $40,000, drop down to $30,000. And now it’s just in this range and everyone is looking for the break either upwards or downwards.

But at the same time, Ethereum did some great profits and huge gains. And I’m very happy having it in my portfolio.

better time to buy Ethereum instead of Bitcoin
Ethereum made great profits

To make it easy and to summarize, just open Crypto.com or any other crypto exchange. And go to the asset and compare Ethereum versus Bitcoin. And if you see the chart going up it means that Ethereum is stronger. At that moment it is better to invest in Ethereum. And if you see the chart going down, like what I see from September 2020 to December 2020, this means that Bitcoin is stronger than Ethereum. It would be better to invest in Bitcoin at that particular time.

Buy different crypto coins to diversify the risk

Now, at the moment I’m writing this lecture in January 2021, one more time, Ethereum versus Bitcoin goes aggressively up, which means that Ethereum gains much faster compared to Bitcoin. And that same technique you can use for any other cryptocurrency pair.

If you look at the Crypto.com platform, there are a lot of possibilities as trading assets.

The trading assets

There is the Litecoin versus the Bitcoin, EOS versus the Bitcoin, Link versus the Bitcoin, and so on. So at any moment, you can see which one performs better, which one gains more compared to Bitcoin.

I always suggest my students diversify the risk into different coins, not depending on one. The technique that I explained in this lecture will show you at any moment if it is better to buy Bitcoin or Ethereum, or any other crypto pair.

Thank you very much for reading the lecture. And don’t forget to leave a comment below if you still find it difficult to decide should you buy Bitcoin, or Ethereum, or any cryptocurrency instead of another. I’ll see you in the next lecture.

Crypto Bot Trading - How To Get Started

Crypto Trading Bot: WHAT? WHERE? HOW?

Crypto Bot Trading – How To Get Started In 2021

Today I will explain what is a crypto trading bot and how you can use one, where you can trade with the robot and how you can get one. I will explain to you what is the difference if you are trading at a cryptocurrency exchange or with a crypto broker.

So first of all, the crypto trading bot is just an automated system. An automated strategy that will execute the trades for you. So you don’t need to stay in front of the monitor. No need to click the Buy and the Sell button, to watch the charts, analyze the market, follow the fundamental news, and so on.

Crypto bot trading is already quite popular but many people don’t know that it exists at all. And why is that? Because you cannot trade with crypto robots on the cryptocurrency exchanges. So the crypto exchanges are the most popular method that people buy and sell cryptos and exchange cryptos.

Can We Use Crypto Trading Bot For Automated Trading?

In 2020 on the crypto exchanges you cannot trade automatically, there isn’t such an option. Or at least I’m not familiar with one. Probably by the time you’re reading this article, there will be an option to use a crypto trading bot at exchanges. And of course, we will update everyone on our YouTube channel and in our courses. Probably we’ll record some new courses if there are nice methods for automated trading on the cryptocurrency exchanges.

So for the moment in 2020, you cannot do automated trading with trading Robots on the crypto exchanges. And that’s why many people don’t even know it is possible. The fact is that automated trading is possible since 2017. I have recorded some of the first videos out there about automated trading with cryptocurrencies. And trading, especially the Bitcoin with Robots.

Image of Bitcoin Crypto Trading Bot
Trading Bitcoin With Robots

Actually one of the online courses that I have that got most students back in 2017 was the course where I share the Bitcoin crypto trading bot. So it is possible for long enough, it’s just not available on the crypto exchanges. And that’s why most people don’t know that’s even possible. So how is that possible?

Crypto Bot Trading On MetaTrader Platform

Crypto bots can be used with the MetaTrader platform. MetaTrader platform is the most common platform for trading nowadays. It is popular everywhere in Europe, Asia, in the States. The huge Forex brokers offer the MetaTrader platform, it is free. So MetaTrader is a third-party company.

The company is called Meta Quotes. They have developed MetaTrader and what they are doing is they are selling it to the big brokers. That is actually a fantastic business model they did. Because they don’t get money from the traders, us the clients. They get the money from the brokers.

And as far as I know when I visited last year’s one of the biggest Forex expos in Cyprus, аt that time MetaTrader was quite costly for the brokers. I think they charge the brokers about $75,000 a year, which obviously for the big brokers is nothing.

MetaTrader 4 vs MetaTrader 5

The big brokers spent over $100,000 just for Google Ads per day. So imagine how cheap for them the MetaTrader is. Anyway, that’s not the topic of this article. The MetaTrader is a free platform that everyone can use, access easily, download easily.

There are two options available, MetaTrader 4 and MetaTrader 5. The MetaTrader 4 is the older one but I still prefer to use it especially for algorithmic trading. There are a few reasons I will explain in a second.

So on the MetaTrader platform, you can trade with Robots. If the broker offers MetaTrader with Bitcoin or Ethereum, Litecoin, Ripple and etc., you can trade with cryptocurrency expert advisors.

These are usually the four cryptocurrencies that you will find on MetaTrader. And you can trade them with a crypto trading bot. If you have a broker that offers a MetaTrader with automated trading and it offers cryptos you’re good to go with crypto Robot. And this is what I show in my courses. So there are a few different ways you can do it.

Available Options For Robot Trading On MetaTrader

You can buy a crypto trading bot from the market, which is obviously the easiest way. But sometimes it could turn out to be the hardest. Because you never know what is on the other side. You never know what is in the code if you are not a developer. I’m not a developer too. So if I buy a crypto trading bot I will see the performance they promise but I don’t know what is inside the code.

I don’t know when this crypto Robot will be buying and will be selling. So I personally would never go for that method. Especially for Bitcoin because I don’t know what’s the trading strategy behind it. I don’t know when it will sell or when it will buy. I don’t know what percentage of risk there is with this crypto trading bot in my account.

Another option is to hire a developer which is not that difficult to be done. I have done it a lot in the past. I’ve hired many developers to code my strategies for Forex. And it’s quite difficult honestly, these guys take a lot of money, their hourly rate is expensive.

Back in the time when I was doing it, it was in 2013. They were charging about $30 to $40 per hour. And if you want a crypto trading bot with a few entry rules and exit rules you will be paying at least a few hundred dollars. And the thing here is something a few traders know, there is a huge dilemma when you are hiring a developer.

You Need To Have A Profitable Strategy

You need to have a profitable manual strategy so you can order it to the developer. And they will make it for you as a crypto trading bot, they will code, right? For MetaTrader, it’s MQL coding that will work so the crypto Robot can work on MetaTrader. But there is a dilemma here. You need to have a good manual strategy to order the developer to send you back, you pay him he will send you back the code for this crypto trading robot, right?

But the only way to know if a strategy is profitable is if you can perform a backtest with the Robot. So the backtest is basically the option in MetaTrader where you can put the crypto trading bot. And you will see how it performed for the last 3, 4, 5, 10 years for example. Usually, for Bitcoin in 2020, we’re looking for the last 4 years just before 2017 where there was the boom and we don’t really care about what happened before that because Bitcoin was so cheaper compared to where it’s now.

So when you have the crypto trading bot, you can perform a backtest. And you will see exactly how the strategy performed, what profits to get, where it opened and closed trades, and so on. We’ll see the equity line of the Robot.

So this is the dilemma, guys. If you want to order a crypto trading bot to a developer you need a profitable manual strategy. But you don’t know if a strategy is profitable without a trading Robot. So how will you know if a strategy is profitable if you don’t have a trading Robot, you don’t know that, right?

Strategy Builders – The Modern Way To Create A Crypto Trading Bot

So what happens usually is, the traders believe they have a profitable strategy. They order to developers and when they send them back the code, they do the backtest and they will see what losses and they realize that their strategies were not that profitable as they thought. This happens like 95% of the time I can assure you that.

So the other method to create a crypto trading bot is using strategy builders. This is what I use, honestly, it changes the trading because I can build a crypto trading bot without any programming skills. I just put the entry, the exit, the Stop Loss, the Take Profit, I build the trading strategy and I can export it as a crypto Robot. Some of the strategy builders, the software are expensive for most of the traders. They find them expensive and that’s why of course on the market there are different options.

There are cheaper ones, there are more expensive ones. But I want you to understand what is the difference compared to the crypto trading bot that is ready to use. And you can put it on the MetaTrader platform and you can trade with it.

So, what is the strategy builder?

Strategy builder is a program that we use to build ready-to-use trading robots without programming skills.

The Expert Advisor Studio

I don’t need to hire developers anymore. I started using strategy builders about 3 years ago. So I stopped hiring developers. I don’t have a single developer in my team. And this changed my way of trading when I found some great strategy builders.

We have the Expert Advisor Studio, for example. We have it on our website for our students and traders. Some people find it costly but as I said that’s the market. If you want to use good software usually you have to pay for it. It’s like everything else, right? When you’re designing, when you’re editing videos you have to pay for the good product and there are others that are quite cheaper. There is the EA builder, the Strategy Tester, there is Strategy Quant. Forex Strategy Builder Pro is the other one I’m using but it’s a little bit more advanced.

Expert Advisor Studio is the one that I found best about 2 years ago and since this time I’m using it. The good thing actually with EA Studio is that there is a 15-day free trial, which you can test so during this time you can build an unlimited number of crypto trading bots. And there aren’t any obligations, you don’t need to put credit card details or something, you just register for it. During this time you can build many crypto Expert Advisors even if you’re not a developer like me.

Another good thing is that the software has a trading strategy Generator that allows you to import historical data from your broker and it will generate strategies for you. It will generate your crypto trading bot, it will show you different strategies for Robots and you can basically download them and use them. So taking advantage of the free trial I think it’s a great experience for every trader.

Using The Best Strategy Building Software Makes Crypto Bot Trading Profitable

I know many are doing it, a few can afford to buy it which is absolutely understandable. But one more time, when you are trading with bigger amounts and when you are doing that as a full day job, obviously you want to use the best software out there. Because they change the trading, they make it all possible.

And there are so many traders that buy ready-to-use crypto trading Robots from the market and they are expensive as well. Some of them are ready-to-use cryptocurrency bots, which are quite expensive and if you buy a few, you might spend more money than actually buying the software from where you will be able to make Robots for a lifetime. It’s quite interesting to do trading with a crypto bot honestly because you don’t need to be in front of the computer.

Keep In Mind The Spread

And one last thing I want to say is that trading on MetaTrader with the brokers is known as CFD trading. It’s much cheaper compared to if you do it on crypto exchanges. So even if you do it manually, even if you buy and you sell cryptos manually but you’re doing it intraday, or at least I mean if you buy a Bitcoin today and you sell it tomorrow or in a few weeks time.

It will be cheaper for you if you do it with the broker compared to the exchange. Because the fees on the crypto exchanges are huge. If you want to buy one Bitcoin at the moment in December 2020 on Coinbase you will be paying about €300 I think or a little bit above $300 that’s huge, right?

And if you are trading with a broker no matter if it is with a crypto bot or if it is manually, you will be paying about $10 to $25 of spread.

The spread is the difference between the Bid and the Ask price. We buy at the Ask price, at the more expensive price. We sell at the Bid price.

Why Trading For Shorter Or Longer Period Of Time Matters

So it is cheaper to trade on the Forex brokers if you are keeping the trade for a few hours or a few days compared to if you are trading, or actually it’s more of investing, on crypto exchanges. And if you keep the coins for a longer time, like what most people do, then the crypto exchanges will be cheaper because on the brokers there are fees that you pay when you hold your position overnight.

bitcoin trading example during time
Trading For Shorter Or Longer Period Of Time Costs Differently

And if you hold it for a long time then it will get more expensive compared to the exchange. I have recorded another video about that because a few traders understand what’s the difference in the fees.

But one more time if you are buying and selling Bitcoin or any other in a short period of time then you better use the brokers. And if you’re holding it for a long time, then you need the exchanges and keep your coins in a safer place than the crypto wallets.

So with the Robot, with the crypto trading bot, we actually spent less because we are buying and selling quicker. Some of the crypto Robots will buy and sell just in a few hours, they will buy the crypto, they will sell it in a few hours, then they will buy again, and sell. It’s a lot of volume. A lot of trading that happens out there. That’s why it’s cheaper on MetaTrader. And one more time, that’s the only place where we can trade with crypto Robots. And something quite interesting is that on one account you can trade many Robots not just one.

Trading 99 Crypto Bots In 1 Account

Back in 2017, I recorded a course where I show how you can trade 99 Robots in the same trading account. Now in 2020 I have re-recorded it but no one else even shows such trading until the moment which is quite surprising for me.

And when I trade with 99 crypto bots in the account I have the chance to diversify the risk because these are 99 different strategies, 99 different Robots. And they all buy and sell, buy and sell, buy and sell. Definitely, the brokers win a lot of spread from me but crypto bot trading is not possible on the exchange.

So what I show in this course is quite interesting because I put 99 Robots in 1 account. Then I follow the performance and I see which are the top crypto trading Robots for the current market. Because especially the Bitcoin market is so different from man to man. Sometimes it’s very bullish, it goes just up, then it goes sideways for a long time, sometimes it goes down.

Using The Best Trading System

And what I achieve when I trade with 99 Robots is that I see it every moment which are the crypto trading bots that are suitable for the current market. And I grab them and I put them in another account where I will be trading with more volume.

So usually I have 1 account where I test many crypto trading bots and I extract the ones that are suitable for the current market condition and I put them on another account. This is the best option I found and the best system I found so far.

I found it in 2017. In 2020 I used the same system and as I’ve said, I didn’t see any other instructor and trader doing a similar course until the moment. Which is really strange for me. I mean good they didn’t do it but I want more and more people to see this system because it’s really great.

The Crypto Expert Advisor

And to make it possible for everyone who takes the course actually I am including these 99 crypto trading EAs in the course. EA is Expert Advisor which is the actual term for a trading Robot, Robot or bot is just slang. So, the real term is Expert Advisor. So there are many opportunities to trade with crypto. What I personally prefer is using crypto trading Robots.

I don’t say you must go for a crypto bot but I personally feel I’m trading right now while I’m driving, and I’m recording this video. And I’m actually doing it. If I was going to do it manually probably I will be just on the phone and buying and selling. But that’s not professional trading.

I’m talking about professional trading in my videos. So everyone who is on the phone buying and selling cryptos, Forex stocks, anything, that’s not serious. Sorry to say that but I’ve been working for brokers and I know that over 95% to 97% of the people that are trading from the phone are losing money at the end of the day.

Don’t Trade Using Your Phone

You cannot follow the market on the phone, you cannot use crypto trading Robots on the phone, and you cannot really trade from the phone guys, don’t do that. You will lose your money.

example of a person trading from phone
DON’T TRADE FROM YOUR PHONE

What you need is to sit in front of the computer. You need to follow a strategy or you can trade with a robot if you want. I’m talking in general here not just about the crypto trading bots or the Bitcoin Robots.

Don’t trade from the phone. Take it seriously when you do it as a hobby spend one hour in front of your computer and laptop and don’t trade from the phone. The brokers will tell you it’s better because they want you to lose money keep that in mind.

Conclusion

So that’s what I wanted to share with you about the crypto trading Robots, they work on MetaTrader. And you need a regulated broker. Make sure it’s regulated before you fund your trading account. And from there you need to choose how you will get a crypto trading bot. It’s hard to code it by yourself. A lot of people are trying to do that, it will take you months and years.

So for me the best option one more time is to use a trading strategy builder. Or to get a crypto trading bot from a trusted place. Where they will actually show you and explain how the Robot works, how it was created, and what it’s meant to be.

Thank you guys for reading this article. I hope you have found it useful. If you did, please leave a comment below or subscribe to our YouTube channel to get more of our free crypto trading videos. See you in there, cheers.

Candle Color Strategy

Candle Color Strategy: Trade Bitcoin on H1

Candle Color Strategy

Dear traders, Candle Color Strategy is the 4th strategy that I will be teaching you. This is one of my favorites trading strategies because it is very easy to follow. And it’s more of a price action trading because the entry rule is not based on an Indicator in MetaTrader, but it is when we have such consecutive candles going down or going up. So when we have bullish or bearish candles formation. And I will explain that in a while.

So let me open one more chart window for the Bitcoin. It will be on H1. I will change the template on black background. Here it is.

I change my chart background to black

So the rule that we have in this candle color strategy is to Buy when we see 4 consecutive candles formed in one direction, I guess this is easier for me to explain.

Or in other words, if we see 4 consecutive bullish candles, 4 consecutive bars, or 4 consecutive candlesticks that are with the same color on the 5th one, we open the trade.

candle color strategy shows us when to buy
We buy on the 5th one

This is a bullish example. I will put quickly 1 horizontal line and 1 vertical line. Let’s make the horizontal lime because this is a Buy trade. It’s all right. Here, we Buy 1, 2, 3, 4, and on the 5th one, we Buy.

So that’s not really an Indicator. But we are just looking for 4 candlesticks with the same color to Buy, 4 candlesticks or bars with the opposite color to Sell with this candle color strategy.

The 4 Candlestick Values

The black bodies are the positive ones and the white ones are the negative candlesticks. And we have 1 condition. We need to see a minimum body height of 50 pips. So for the beginners, one more time.

The body of the candle is the distance between the closing and the opening. We have 4 values. If I put the mouse on any of the candlesticks, we have 4 values open, high, low, and close.

The 4 values of the candlestick
The 4 values

We have the open of the candle. The price goes up and down.

We have the lowest point that it reached, the highest point, and here is the closing.

The highest and lowest point, and the closing
The highest and lowest point, and the closing

So with the bullish candles, the body height is the close price minus the open price. For the bearish, this candle, for example, is the opposite thing. We have the open price minus the close price.

The bearish
The bearish

So the condition here is that we need to see minimum 50 pips of body height. And now, I don’t want to make you confused about pips and USD here with the Bitcoin for Pepperstone, for example, we have 2 digits after the decimal comma.

The pips

So these are the pips.

The Moving Averages

And if I say 50, then it would be 50 cents. So if we have 3 digits, then we have pips and point. But if we have just 2, this is pips or in other words, to make it very simple, we need to see 4 consecutive candlesticks and the body of each one must be minimum 50 cents of the price of the Bitcoin.

So in this example, the small candle that we have has a close of 10367.01 and it has an open of 10361.51, so it’s much more than 50 pips in this case. So we Buy and then what we have as an exit condition. We have 2 Moving Averages.

I will add them to the chart. From the Insert menu in MetaTrader select Indicators, then Trends, and click on Moving Average.

Using Moving Average in our Candle Color Strategy
Moving Average

The 1st Moving Average is with period of 15. I will make it red.

The 1st Moving Average
The 1st Moving Average

And the 2nd one that I will add to the chart, this is a Moving Average with period of 45 and let me make it blue, for example. I click on OK and here it is.

The 2nd Moving Average
The 2nd Moving Average

So when the fast Moving Average or this is the 15-period Moving Average crosses the slow Moving Average in this case, this is the 45 downwards, we exit the trade. And let’s see where this happens, it happens right over here.

Exit the trade
The exit

OK, I will put quickly 1 vertical line and 1 horizontal line.

Take Profit and Stop Loss

So the exit is again on the next bar. We have the cross and it is confirmed on the opening of the next one. We have 4 consecutive bullish candles with a minimum body height of 50 pips.

And then the price goes up, up, up, up, and then a little bit down. And then when the fast Moving Average crosses the slow Moving Average downwards, we Take the Profit. In this case, it is a profit of 329 or something like that, above 300 USD of a profit.

The profit from this candle color strategy
We made a profit of above $300 profit

But again we have Stop Loss and Take Profit. The Take Profit is 240 USD. So first we will have the Take Profit hit I guess somewhere in this candle 240 USD above the open price. So it’s 10505 plus 240. That will be 10745. Actually it’s a little bit earlier, 45.

I guess it will be hit with that candle. Exactly 45. So we have the Take Profit a little bit earlier and then we have a Stop Loss below of 215 USD Stop Loss. This is a great example of this candle color strategy. Now, right here, we see the opposite example. 1, 2, 3, 4, on the opening of the 5th one, we have a Sell trade.

Candle color strategy sell trade
The sell trade

Candle Color Strategy With a Few Indicators

For sure, these candlesticks, they have over 50 pips or as we said, for the Bitcoin, this is 50 cents. We Sell on the opening of the 5th candlestick. And here again, we will have the Take Profit hit because the price is 10688 minus 240 USD of a Take Profit.

That would be 10488, we Sell and then we Take the Profit. So one more time. This is one of my favorite strategy because the chart is very simple and you really don’t need to have a lot of Indicators over it. All you need to look for is 4 consecutive candlesticks with the same color.

And then on the 5th one, you open the trade. And again, I will attach the PDF with a description of the strategy, very simple Candle Color.

Candle Color Strategy explanation
Candle Color Strategy explanation

And we have bullish candle formed to Buy and bearish candle formed to Sell 4 consecutive candles and minimum body height of 50 pips.

And we have the exit Indicator, which is the Moving Average cross.

Thanks for reading this lecture. I wish you always have a great day.

Trading Bitcoin Forex Brokers vs Cryptocurrency Exchanges

Trading Bitcoin: Forex Brokers vs Cryptocurrency Exchanges

Where to buy Bitcoin

Hello everyone. In this lecture, I will show you what is the difference between trading Bitcoin on exchanges and trading Bitcoin on brokers. And as you probably know, the most popular way to participate in the Cryptocurrency market is through Cryptocurrency exchanges.

So, for example, right now on my trading screen, I have my account on Coinbase where I have been personally buying Cryptocurrencies.

Coinbase

It’s very easy to do it. We have the Trade button. I simply click on it. I decide how much Bitcoin I want to buy, for example, for 500 EUR. And I can pay straight with my Visa card.

If I click on Preview Buy,

Click on Preview Buy

I will see how much exactly I will receive as Bitcoins, what is the purchase, and what is the Coinbase fee that I will be paying. If I pay with my Visa card, it’s a little bit more compared to if I use my EUR wallet on Coinbase. And then I just Buy it and I get the Bitcoins.

From there, I can send them to a wallet or I can exchange them for different Cryptocurrencies.

Trading Bitcoin with Brokers

Now on the other side, we have the brokers. These are companies that offer trading platforms. For example, now I have the MetaTrader platform, which is the most popular platform for trading with brokers.

The MetaTrader platform

It is free for us the traders, and most of the regulated brokers are for it, which is great.

And the difference here, when we are trading Cryptocurrencies and not Forex, is that we are doing CFD trading.

So here is the Bitcoin. But if I want to Buy it, if I click on New Order,

I click on New Order

I will be Buying with lot size. This is the term that we use in trading. So 1 lot nowadays for Bitcoin equals 1 Bitcoin, but I can Buy 0.01, for example.

Trading Bitcoin With CFD

So if I have an account of $5000. This is what I have here for the purpose of this course, I can use this money to sell Bitcoin even without buying it previously. This is what the CFD does.

The main difference for the beginner traders is that I have a Buy button and I have the Sell button. Something that I didn’t have on Coinbase.

CFD trading stands for contract for difference. Every time I Buy or every time I Sell with the broker, I make a contract with the broker that if the price goes in my direction, I will benefit out of that. And if the price goes against me, I will lose because of the difference in the price.

For example, if right now I Buy Bitcoin at 18 203 and the price goes to 18 800, I will benefit from the difference of $600. At the same time, if I Sell the Bitcoin right now and the price drops to 18 000, I will lose that difference of $178 and something. This is the CFD trading.

Trading Bitcoin with CFD
CFD trading

I don’t physically Buy Bitcoin. I won’t be getting the actual coins in my portfolio. With the amount of money that I have in my account, I will be able to Buy and Sell.

Brokers vs Exchanges

Many of my traders and students ask me which of the two is better.

Is it better trading Bitcoin just on the exchanges where we get actual coins and we have much more assets to Buy and to exchange Cryptocurrencies? Or is it better trading Bitcoin with CFD because we can Sell without having the coins previously?

For the moment, I don’t recommend one of the two. You need to understand that these are 2 different types of trading Bitcoin and participating on the market. It really depends on what you want to do exactly.

For example, if you want just to Buy Bitcoin or any other Cryptos, you want to hold them for months or years and then sell them in the later stage when you have a better price and you can benefit from that. Or if you want to use them for actual purchasing online or you want to use the Bitcoin for any other purposes, definitely you need to go through the exchange because you’re getting actual coins.

Now, the downside of the exchanges for the moment is that it doesn’t allow algorithmic trading. And this is exactly what I will be showing you in this course, how to trade Bitcoin with Robots. For the moment, in 2020, the most reliable method, and that’s been the most reliable for the last decade or so is the MetaTrader platform.

Trading Bitcoin Leverage

With the MetaTrader platform, we can trade with Robots using CFD trading. This is how we do algorithmic trading nowadays.

Maybe in the future, the Crypto exchanges will allow algorithmic trading. And of course, I will update you as soon as this happens. But for the moment, the most reliable way to do algorithmic trading with Robots is on the MetaTrader platform.

This is because we have backtest, because we can trade many Robots on one single account, and because the most trusted brokers and regulated brokers offer the MetaTrader platform. This is what exactly I’ll be showing in this course.

For the purpose of this course, I have selected to use the HotForex broker, which is a broker that I have been using at the moment, and please don’t take as a recommendation any of the brokers that I show in my courses, my courses are for educational purposes.

But as you already know, I will include some ready to use Expert Advisors. And since I’m rerecording this course completely now in 2020, it will be much better than the old version. The Robots will be better I will explain why a little bit later in the course. And I have changed many of the lectures, so it will be easier for you to start with algorithmic trading if you are a complete beginner.

Later on in the lecture, I will show you more about the MetaTrader platform and as well, I will tell you why it is super important to start with a Demo Account so you can practice on the market.

Trading With Bitcoin On MetaTrader

Now, after you install your MetaTrader platform, you are ready to go once you’re logged in into your account. You can see the Market Watch where we have the Bid and the Ask price changing all the time, which means that we are connected to the server of the broker and we have access to the market.

The Market Watch showing example of trading Bitcoin
The Market Watch

So no matter whether we are using a Demo Account, we can participate on the market and practice. And that’s the best thing, actually, with having a Demo Account because you are actually trading, of course, without having any real profits in the account or any losses. But that’s the idea of practicing with a Demo Account.

Now, on the left side, you will notice the Market Watch where we have different assets. We have the currency pairs on the top with Hot Forex and then we have gold, some indexes, oil, other commodities. Then there are some stocks. And if I scroll lower, you will see the Cryptocurrencies.

The Bid and Ask price

We have Bitcoin versus the USD, which is obviously the most popular asset that everyone trades then we have Bitcoin versus the EUR, Ethereum versus the USD, Ethereum versus the EUR, LTCEUR, LTCUSD, and we have the Ripple as well. Honestly, I haven’t seen much more of a difference with other brokers when it comes to variety of assets for CFD trading.

But in this course, I’m focusing on the Bitcoin and I trade personally the Bitcoin with Robots because it’s the most volatile asset and this is where we can maximize the profits when we are trading volatile assets. And trading Bitcoin versus the USD is definitely one of the most volatile assets.

Now we have 2 columns. One is the Bid price and the other one is the Ask price. Keep in mind that when you Buy, you always Buy on the Ask price, which is the more expensive price. When you Sell, you Sell on the Bid price. Also, when you Buy Bitcoin and then you close the position, you will be Buying it on the Ask price. And then when you close the position since this is a Sell order, you will be closing it on the Bid price.

The spread

And if you want to see exactly how much is the difference between the Bid and the Ask price, you can right-click over the Market Watch and check spread.

Spread check while trading Bitcoin
Check Spread

This will show a 3rd column and this is exactly the spread. With most of the brokers, the spread is floating, which means it’s changing whenever there is volatility. At this moment with Bitcoin, it’s about 24 USD.

The current Bitcoin spread
The current Bitcoin spread

And something important to notice here is that HotForex has 3 digits after the decimal comma for the Bitcoin. So you can see that the Ask price is 18077.045. There are 3 digits after the decimal comma. So this means that the spread, which is displayed as 24 000 something, is actually 24 USD. So if I Buy 1 complete lot and I close the position or I Sell 1 complete lot and I close the position, I will pay about 24 USD as spread.

It looks much more compared to the others. But keep in mind, the Bitcoin is the most expensive asset right here. And at the same time, if you buy Bitcoin on Coinbase or on any other Cryptocurrency exchange, you are still paying a fee. So for example, on Coinbase, with my type of account, I can Buy maximum 7 500 of Bitcoin, which if I click on Preview Buy, you will see that the Coinbase fee for that transaction will be 287 EUR, which is much more compared to 25 USD.

Coinbase fee for the transaction
Coinbase fee for the transaction

The swap

And this is for 7 500 EUR, which is actually less than half Bitcoin. So if I’m Buying a complete Bitcoin on an exchange like Coinbase, I will be paying more than 560 – 570 EUR for that transaction. And after that, when I’m Selling it or exchanging it for other Cryptos, there will be more fee, obviously. Just wanted to compare it one more time with the exchanges, because many people say that it’s more expensive to trade the CFD trading, but that’s not actually the reality.

And it might get more expensive if you are holding your position for a long time. Because when trading with Forex brokers like Hot Forex or any other, we pay as well swap. If I go to Specification,

Specification on MetaTrader
I click on Specification

you will see that I have -6 000 points, which is I think 6 USD in this case of a swap because we have 3 digits.

BTCUSD contract specification
BTCUSD contract specification

So this is about a 6 USD fee if we hold the position overnight.

The brokers will charge us a swap when they transfer the trade for the next day. And we don’t have that on the exchanges. When we Buy Cryptos, we don’t pay a fee for holding it in the account. So only in the case when you hold the trades for a long, long time on your MetaTrader account or on your broker’s account, it might get more expensive to trade the Bitcoins here because you will be paying swap every night.

HotForex broker

But, because we are trading with Robots we close the trades quickly, some of the trades will not last over the night. The Robots that I included in the course will not last through the weekend. So we have 3 days swap as well with the brokers, which means that if we have a trade opened on Friday or we have an open trade during Friday and it goes through Saturday, Sunday, and Monday, the market opens again, then we will pay swap for these 3 days.

Here it is 3-day swap that is charged on Fridays. This is how the trading works. And on the exchanges, we don’t have such costs. Such a swap. But one more time, as you saw, the fee is much more expensive compared to the spread that we have with Hot Forex in this example.

And back in time in 2017, 2018, when everybody was crazy about the Bitcoin and the brokers just placed the Bitcoin on their platforms, the spread was absolutely crazy. It was reaching about 200, 300 USD. At that moment, I didn’t use Hot Forex. I found it later as a reliable broker. So I don’t know what was their spread during this time.

Trading in Cryptocurrency Exchanges

But now with most of the brokers, the spread is somewhere between 15, 20, 25, 30 USD, which is just fine compared, one more time, to what we have on the exchanges. So that’s why I said that the exchanges are more suitable if you Buy Cryptocurrencies and you hold them for a long time for investment purposes.

This is what I’m showing in my Cryptocurrency investment strategy course where I analyze the Bitcoin, for example, on TradingView that is another platform for trading, very popular, especially for technical analysis like what you see below.

Using the TradingView platform for bitcoin trading
The TradingView platform

But in that course, I teach the investors how to Buy Cryptocurrencies and when exactly to Buy, when exactly to Take Profits and to Sell the Cryptocurrencies. But that’s different. That’s investment.

And this is why there I demonstrated over the Coinbase and personally I use for this system Coinbase. But when it comes to algorithmic trading, trading with Robots, MetaTrader is much more suitable with the broker as Hot Forex because there we have much lower fees or in trading this is called spread. And if we are closing the trades within the same day or within a few days, we don’t pay huge swap, which is just fine.

Bitcoin Trading Hours Limitations At Brokers

Why did I say that the trades don’t last over the weekend with the Robots that I include in the course? This is because with the Forex brokers, usually, we don’t have trading on the weekend. You can see the gaps below. There is no price between these levels.

The gaps in MetaTrader bitcoin trading
The gaps

So if I go to Properties and I go to Common and I uncheck show grid, but I check show period separators and I click on OK,

I uncheck Show grid and check Show period separators

you will see that this is exactly between Friday and Monday. Let me go to the current price. I can go as well with the End button on my keyboard. Or if I press this button on top that says scroll the chart to the end of the thinking coming and zoom it.

trading bitcoin example
Scroll the chart to the end button

It shows me that today it is the 10th of December, which is Thursday. We have Wednesday, Tuesday, Monday. It was the 7th of December 2020. Then the next day is 4th of December, which was Friday. And then we have Thursday, Wednesday, Tuesday, Monday, which was the 30th of November 2020. And the next day is the 27th of November 2020. This is the weekend.

This is Friday and here starts Monday. So we don’t have trading on the weekend with most of the Forex brokers for Cryptocurrencies.

We don’t have trading on the weekend with most of the brokers

What’s more to come

And this is why the Expert Advisors that I included in this course will not hold positions over the weekend. Everything will be closed until Friday. And this way, you don’t worry if there are such gaps.

This is one of the things that I have improved compared to the EAs from the previous course. Because before, there were brokers offering trading during the weekend and these were the type of EAs I was using. And then when I shared the EAs in my course, some of the students complained that their broker doesn’t have Cryptocurrency trading during the weekend.

So no worries about that anymore. You will not see trades opened during the weekend.

In the next lecture, I will give you more details about the MetaTrader platform, and you will learn more about the chart and the different windows that we have on that popular platform.

Thanks for reading.

Bye.

Volume Trading Strategy

Volume Trading Strategy for Bitcoin on H1

Volume trading strategy that works great for the Bitcoin

In this lecture, I will show you a Volume Trading strategy for Bitcoin, which I use on an hourly timeframe, and I call it the VAM. I have 3 Indicators as entry rules, I have 1 Indicator as an exit rule, and I have a Stop Loss and a Take Profit.

So I will start with the 1st one. I will open a new chat window.

Volume Trading strategy for Bitcoin
I right-click and select Chart Window

I will right-click and go to Template, and I will select a Black background.

I right-click and go to Template, and I select my Black background template

Then I will change it to the hourly chart. The 1st Indicator that I will insert on the chart is the Volumes indicator.

I go to the Volumes group, and the last one is just Volumes. Click on it.

How to insert Volumes

And as levels, I will add a level of 5300 and I click on OK.

Volume Trading strategy for Bitcoin
Volumes levels

You will see the Volumes indicator below the trading chart, and you can see the level of 5300.

Volumes

So the entry condition to buy is when we see the Volumes crossing the level line upwards.

For example, you see below that it is crossing it.

The cross

After that, again, it crosses it upwards and this is our entry-level or simply when the Volume increases. But we have an exact rule using the 5300 level and we have 2 Indicators as confirmation.

The confirmation for the Volume Trading strategy

The 1st one is a Moving Average. I go to Trend, and I go to Moving Average.

How to insert a Moving Average

I will set a period of 31 and I click on OK.

Moving Average parameters

Here it is.

Volume Trading strategy for Bitcoin
The Moving Average

We want to see the Moving Average rising to have the confirmation. So when the Moving Average is falling like the case seen below,

Falling Moving Average

if we have the break as seen, we have the Volumes crossing the level line, but already the Moving Average is falling down.

So we don’t have confirmation to buy. For this Volume Trading strategy the 3rd Indicator is the Awesome Oscillator, which needs to be rising again. Indicators, and I go to Awesome Oscillator.

How to insert Awesome Oscillator

I click on OK.

Volume Trading strategy for Bitcoin
I click on OK

It doesn’t have any levels or parameters. It’s formed by red and green bars that are going above and below the 0 line. Alright, so the confirmation here is that we need to see the Awesome Oscillator rises.

So, one more time, we Buy when the Volumes crosses the level line upwards. But at the same time, we need to see the Moving Average rises and we need to see the Awesome Oscillator rises.

It doesn’t matter if it is below or above the 0 line. For example, at the current moment, we don’t have it crossing the level line and it just stopped. We don’t have the entry. I will go back through the chart, and now we are on H1.

Every strategy has losing trades at some point. So this Volume Trading strategy for Bitcoin.

Make sure you follow the first 2 strategies on M15, and the 3rd one is on the H1 chart. I will try to see some examples with confirmations and as well I will try to see some examples of losing trades because, with every strategy, we have losing trades as well, Keep that in mind. This is very normal. 

But obviously, I include in my courses the strategies that have more profitable trades than losing trades or overall, they have profitable equity lines for the moment. And I think we would have the confirmation.

When the Volumes crosses the level line, we have the confirmation. The 1st crosses, and then we have another one. But at this time, the Oscillator is already falling. I will zoom it in so we can see a little bit better.

The 1st time we have the cross is at this bar shown below, the Volumes crosses the level line upward.

The cross

On the opening of the next bar, we are taking the trade because the Awesome Oscillator rises as well as the Moving Average. Again, we take the trade when the new bar opens.

Stop Loss and Take Profit in this Volume Trading strategy 

When this bar is closed and the new one opens, we see that we have a cross and on the opening of the next one, we take the trades. What you need to keep in mind here is that when the new bar comes, the Volumes start from the ground.

So if I go to the current moment, you will see that the bar opened about 8 minutes ago and it starts to increase the Volumes. When the new bar opens, it starts from 0. And then according to the Volumes that we have, it will increase. Below is the entry.

The entry

This is the cross. And on the opening of the next one, we take the trade. We don’t know if on this current trade there will be Volumes higher than the level line. The signal is with the previous candlestick. This is very important to note.

At the same time, we have the Moving Average rising and we have the Awesome Oscillator rising. So we have 2 confirmations to buy. For this Volume Trading strategy, we have a Stop Loss of 215 USD and a Take Profit of 240 USD. Let me put the lines exactly.

The entry

The entry is 10 362 and Take Profit of 240, which will make it 10 602.

Take Profit

Then we have a Stop Loss. I will make the Stop Loss red and I will drag it 215 USD lower. We have the entry at 10 362 minus 215. This is 10 147 if I’m not wrong.

Volume Trading strategy for Bitcoin
Stop Loss

I’m trying to put it exactly, but it’s hard because I am on the hourly chart, so it’s 10 147. I’m not calculating the cents, just the USD. But as I’ve said, if you are doing actual trading, you need to calculate it, obviously.

So this is the entry. This is an aggressive move and the price hits the Take Profit of 215 USD very quickly. And we are out after 3-4 hours with a great profit. So this strategy indicates the volatility or the volume, and it uses the Volumes indicator and it uses confirmation of Moving Average and the Awesome Oscillator.

It’s a really great strategy. Now, we have an exit condition as well. This is with the Envelopes. I will put the Envelopes.With the other strategy, we had the Envelopes as an entry, but here there is an exit and I will keep them both aqua color.

The exit rule

But here I have a period of 24 and a deviation of 0.8 and I click on OK.

Envelopes parameters

You will see the Envelopes going upwards together with the price in this case.

Volume Trading strategy
The Envelopes

And the exit rule here is that we need to see the bar opens below the upper band after opening above it. It’s pretty much the same thing.

We want to see the price outside the band. And when it gets inside, we see a bar opening. This is our exit. We enter, the price goes outside the Envelopes, and on the 1st bar that opens inside the Envelopes, we take the profit or we close the position, even if it is a loss.

But with this example, we had the Take Profit hit first. It’s very important to note that we are selling with the opposite confirmation from the Awesome Oscillator and from the Moving Average, but the Volume stays the same. When we Sell, I will remove all of the lines from this example.

When we sell, we use the Volumes, again, crosses the level line upwards because we are looking for the volatility no matter whether we are buying or selling. But for the selling, we need to see that Awesome Oscillator falls and as well the Moving Average falls. I think below we have a great example of a sell trade.

A sell trade

You will get used to the Volume Trading strategy in due time

Let me put the mouse on that right here. OK, I’m used to the strategy, so I see it very quickly, but I’m sure after some time you will get used to it. And here is the first cross. OK, you can see the Volumes. The value is 5503 on the closing of that bar. On the opening of the next one, we should take the trade.

And in this case, we are Selling because the Moving Average starts to fall. If I put the mouse on the Moving Average, you can see that on this bar, the value of the Moving Average is 10 924.80. And on this bar, it is already 10 922.97. OK, it’s a smaller value. Same thing with the Awesome Oscillator.

Tthe value is 23 979 and here it is 9207. OK, it’s falling and this is a Sell trade. You can see very obviously we would make a great profit 1st with the Take Profit and 2nd with the exit condition from the Envelope. So the 1st bar that opens inside I think is this one.

We could be taking our profit if we use the exit condition. But first, I’m pretty sure that the Take Profit would be 240 USD lower. So the entry is at 10 995 minuses 240, that would be 10 655. 

I have tested the strategies over a long period of time

But these strategies that I’m showing you, I have tested for quite a long time and they have so far more profits than losses and I always improve them if it is needed accordingly to the market conditions.

Proper money management is required

OK, so if it happens that you have losing trades and it will happen no matter you trade manually the strategies or automatically with the Expert Advisors, don’t panic. This is normal. The strategies have their losing periods. But as I’ve said so far, they have more profits than losses.

And this is why it is very important to have good money management and to risk a small amount of your account. But this is something that I will be talking about at the end of the course. All right, guys, so this is the VAM strategy.

Volume Trading strategy for Bitcoin
The VAM strategy

This is how I call this Volume Trading strategy for Bitcoin because I use Volumes, Moving Average, and also Awesome Oscillator. So it is VAM. This is how I have named it because of the 3 entry Indicators that I’ve been using and I have Envelopes as an exit Indicator. All right. You will find this PDF attached to this lecture and as well for the others.

And one more time, when you are taking this course, the values could be different because the market changes. So the strategies change and I do my best to improve them all the time.

Thank you for reading. And I will see you in the next one where I will be showing you another strategy for the Bitcoin for H1 chart.

See you there.

Envelope Indicator Strategy for BITCOIN on M15

Envelope Indicator Strategy for BITCOIN on M15

Envelope indicator strategy

Hello dear traders, I continue with the 2nd Envelope indicator strategy for Bitcoin, which is again for M15 chart. And before I show you the strategy, I will just need to open another chart window, which I can do if I right-click over the Bitcoin in the Market Watch and I click on Chart Window.

Envelope indicator strategy
Right-click over the Bitcoin and select Chart Window

A new chart opens and it has a totally different layout. But I can customize that as I’ve said if I go to properties,

Right-click and go to Properties

and I can uncheck Show grid,

Envelope indicator strategy
I unmark Show grid

and as well for the colors, if I click on reset,

I reset the chart colors

I will reset it to the black background, which I used on the 1st chart.

So if you want to save any of the layouts as a template, you can do that. Just go to Template, Save Template,

Go to Template, then select Save Template

and you can name it however you wish. Then when you open a new chart, you will be able to switch to your favorite template quickly from your templates.

So I have already my black background template saved.

I use my Black background saved template

This is the one that I will be using. So the 2nd Envelope indicator strategy for Bitcoin is the EnDe, as I call it. I call it this way because of the entry Indicators, I use Envelopes and I use the DeMarker as confirmation.

How do the Envelopes work in this Envelope indicator strategy

So I just take the first 2 letters from both indicators, that is Envelopes and DeMarker, and I make it EnDe. This is just my own system of naming some of the strategies that I use so it’s easier for me to remember them and to apply them. The exit indicators are the Alligator in this case, and I have a Stop Loss of 70 USD and a Take Profit of 200 USD.

Very good risk-reward with this strategy and I will explain how it works. The 1st indicator that I will add is the Envelopes. I will go to Insert, Indicators, Trend, and I go to Envelopes.

Envelope indicator strategy
How to insert the Envelopes

The default value is 14 as a period.

I will change it to 11 and the deviation is 0.39. I click on OK.

The Envelopes parameters

You will see how the Envelopes indicator looks like.

Envelope indicator strategy
The Envelopes as they appear on the chart

These are 2 kinds of Moving Averages that go in parallel and usually the price stays between them. You will see that the price stays between the 2 bands of the Envelopes indicator and when there is volatility, it gets outside the bands.

Representation of volatility by the Envelopes

This Envelope indicator strategy works on M15, something I forget to switch on the chart, so make sure to use it on the right timeframe. But no matter which timeframe you use with the Envelopes, you will always see that the price stays inside the Envelopes when there is no volatility and when there is volatility, it gets outside the bands. 

The DeMarker in this Envelope indicator strategy

This is exactly what I will be using for this strategy. So with this strategy, we buy when the price gets outside the bands and it gets inside back.

Or to make it more precise, we say that we buy when the price gets outside, we see a bar opening above the upper band. And if we have a bar that opens below the upper band after that, this is our entry on the opening of the next bar, which confirms that there is a cross of the bands.

But we have one confirmation and this is the DeMarker, which must be higher than the level line. I will go to Insert, Indicators and the DeMarker is with the Oscillators. I click on it.

How to insert the DeMarker

I will be using a period of 36 for the moment, and Levels of 0.75 above and below it will be 0.25.

The DeMarker levels

I click on OK, and you will see how the DeMarker looks like.

The DeMarker as it appears on the chart

The DeMarker must be higher than the level line which is 0.75. And in this example, you will see that we don’t have confirmation.

No confirmation

Because when we have a bar opening above the band and then we have another opening inside the Envelopes, this is the signal, but we need to see at the very same time that the DeMarker is above the level line, which in this case is below. So there is no confirmation.

We have no confirmation

I see the DeMarker above at some point but in this case, we don’t have a confirmation. Because with these candlesticks, we have a bar that opens outside the band.

But then the next one opens inside and the DeMarker is already below the level line. I want to show an example where we are actually buying and not selling.

Stop Loss

I see that we have a confirmation with our Envelope indicator strategy. The price goes outside the Envelopes and at the same time, we have the DeMarker above the level line. 

This is a signal to buy. Let me put 1 vertical and 1 horizontal line and you will see that at that moment, we have the DeMarker above the level line of 0.75, which is the confirmation.

The confirmation

I will make the horizontal line green because it’s a long trade or we buy at that moment.

What we will have for this Envelope indicator strategy is a Stop Loss of $70. I will put quickly 1 horizontal line 70 USD lower. 

Sometimes I don’t calculate the cents. But in order to be precise, 10 634.78 minus $70, and that is 10564.78.

Envelope indicator strategy calculations
The calculation

Then I will just right-click on the horizontal line properties and I will make the color red because this is a Stop Loss in this case. I will enter the value, which is 10564.78, and I click on OK.

The Horizontal Line properties

The Alligator is a part of this Envelope indicator strategy

It gets on the right spot the very same way I am placing a Take Profit. Now it is red because I changed the color on the other horizontal line, but I will change it to green because this is our Take Profit and the parameters will be 10634.78 plus 200 USD.

That is very easy actually to calculate, 10834.78, and I click on OK. So here is the entry.

Envelope indicator strategy
The entry

At this moment we have the signal from the Envelopes. The price gets outside and gets inside. We have a bar that opens inside the Envelopes.

So this is our entry at the very same moment that DeMarker is above the level line, which is confirmation. At the moment, when you open the trade, you need to put your Stop Loss and your Take Profit. So you’re protecting your capital and at the same time, you are ensuring profits if the price goes in your favor or in your direction.

Now, before we see what happens with this example that I just took very randomly on the chart, I will put the exit indicator, which is the Alligator. The Alligator is a very interesting indicator. I will look for it in Indicators, and I go to Custom.

How to insert the Alligator

It has Jaws, Teeth, and Lips.

Take Profit in this Envelope indicator strategy

It’s a very popular indicator and it has many strategies. But we will be using something very simple. So the values that I will be using is 20 for Jaws period and I have Shift of 18, and then I will use Teeth period of 18 and Shift of 8, and for the Lips, I will have period of 8 and Lips Shift 5, and I click on OK.

The Alligator inputs

You will see another 3 lines over the chart.

The 2 lines on the top are the Envelopes that are parallel. The other 3 are crossing each other. The green one, if I put the mouse on that, is the Lips, the red line is the Teeth, and the blue one is the Jaws.

Envelope indicator strategy
The Alligator indicator

What we have as an exit rule for the long trade is the Lips crosses the Teeth downwards.

So when the green line crosses the red line downwards, we exit the trade, no matter whether it’s on profit or on loss. And the blue line, we don’t use it in this case, which is the Jaws. The price just goes sideways.

It touches the Take Profit exactly. 

You can use any colors of your choice

The red line which is from the Envelopes indicator is parallel to the blue. I’m looking at the other red one. The green one crosses the red one.

Now, in order not to get confused, usually, I change the color of either the Envelopes or the Alligator. Now, because I’m used to the Alligator, what I usually do is change the color of the Envelopes to the same color. So I will take Aqua as well for the lower band, and when I click on OK.

I think it’s much easier because both bands for the Envelopes are blue and we have the green line from the Alligator and the red one.

Envelope indicator strategy
I use different colors for different indicators

We wanted to see that the green one is crossing the red line downwards. This happens at this moment as seen below.

The cross

The price hits the Take Profit

So we would be closing this trade at the level of 10 696, which is about $62 61, something higher. And we take a profit. If I don’t use the exit rule, what happens after that? The price goes up impulsively and we would have the Take Profit now.

It happens in trading that sometimes you will see the price getting very close to your Take Profit, but it will not hit it.

Sometimes it’s really just a couple of cents and it goes back. It can even go back to your Stop Loss, which is not really the best feeling. Let me zoom out the chart to show you, one more time, the example. We have the confirmation from the DeMarker, we have our entry, Take Profit, and Stop Loss.

The confirmation, the entry, Take Profit and Stop Loss

Then I am following the Lips and the Teeth of the Alligator. For this Envelope indicator strategy, I want to see the green line crossing the red line downwards, which happens. We would close the trade on a profit. Then the price hits the Take Profit impulsively higher.

Each strategy has endless outcomes

So that’s quite an interesting example that I have selected because first, the price goes very close to the Take Profit, I really can’t say in 100% if that would close the Take Profit because it’s just touching it. But then it goes down back to the entry-level and then when we have the exit, the price goes to the Take Profit.

So when you start practicing, you will see that there are so many different outcomes for each strategy. Sometimes the Take Profit will be hit, sometimes the Stop Loss, sometimes the Take Profit is very close, but the price goes down.

And in this case, I always like to say that if I am in front of the screen and I see the price getting very close to my Take Profit, I will just close the trade manually and I will take my profit. Because anyway, there is always the risk that the price reverses and you lose the profit. But that’s up to you.

Usually, when I trade with the Expert Advisors or I trade these strategies manually, I don’t touch it. I’ll leave it to the Expert Advisor 100%.

These are the rules that we have for this strategy: 2 entry rules.

Envelope indicator strategy
The strategy rules

The exit in this Envelope indicator strategy

Indicators, I have 1 exit Indicator, and if we are selling, we are using just the very same thing on the opposite side. We want to see a bar that opens below the lower band, and then a bar opening inside the Envelopes. But at the same time, the DeMarker must be below the level line of 0.25.

In this case, let’s see where we have confirmation right over here. With this impulsive movement downwards, we have confirmation and let me remove all the lines. So you will see clearly here that the DeMarker is already below the lower band and the 1st bar that opens inside is right over here.

So at this moment, we would be Selling at about 10 628. And in this case, I think our Take Profit would be hit. $200 lower is at 10 427. The exit would be when the green line crosses the red line upwards, which in this case happens somewhere in here. This is the strategy in both directions.

When you want to buy, when you want to sell, you have the Envelopes as an entry, DeMarker as confirmation, Stop Loss of 70, Take Profit of 200. And these, one more time, are the values that I use for the current moment. And we have the Alligator, which is an exit Indicator.

Stay tuned for the next strategy

So as I’ve said, when I change the parameters in the strategies, I simply change the PDF for myself as well, and you will find it attached. So you will always know what are the current parameters that I’m using for these strategies.

Thanks for reading. I will continue with the next strategy, which is for Bitcoin on H1 chart, or that is for the 60 Minutes timeframe.

We’ll see you in the next lecture.

Cheers.

bitcoin trading example and price action trading

Bitcoin Trading Example in 2020 with Price Action Trading

Bitcoin trading example in an online course is a fantastic way to learn actual price action trading.

Bitcoin trading example lecture. Hello, dear traders, it’s Petko Aleksandrov and in this article from  the course

Price action trading course: Bitcoin and the Cryptos

It really happens too quickly with the Bitcoin, it went above 10,000 just for a couple of days. And I was not planning to record more examples because I don’t want really to make the course really long.

But using Bitcoin trading example is the best way to learn and repeat the right steps.

I will go briefly through the setups and just show you what I traded. So here was the setup from the course.

Bitcoin trading example
The setup.

There was the failure of the recent low, the cross of the EMAs, the break of the counter-trendline, the break of the recent high, and then the price continued higher.

All of the 3 trades were profitable. I took one with the envelope, the next one I took on the second Fibonacci target and then with the third one, I was trading the Stop Loss and at the same time, I used the next Fibonacci which actually is much bigger because the price continued higher. So I had to fix it and redraw it.

Let me show you where exactly it is. The price hits and then the end of this move is right over here.

Fibonacci trading system
The end of the move.

So this Fibonacci got much bigger.

Drawing the counter trend line for this Bitcoin trading example.

Now, what happened then? The price had a pullback. And here I didn’t really see a nice setup to enter into the trade. I’m talking about this zone over here,

there is n Bitcoin trading example
No setup to enter into the trade.

So if I had to draw a counter trend line and let me just show you, it’s something like that.

The counter trend line.

And even drawn like that, there is no failure of the recent low.

So there is a low and then we have a lower low. So there is no failure of the recent low during this period of time. I just waited for another counter trend line, another opportunity, which was a great Bitcoin trading example. It came a little bit after that right over here.

bitcoin trading example
A great example of a counter trendline.

This was a great counter trend line, which is my favourite price action trading technique.

I had 1 horizontal line on the previous bar which I used as the recent high. So there is a series of lower highs and lower lows so I’m waiting for the failure of the low. And there is a failure of the recent low.

The price fails to take this low very close to it but it’s still a little bit higher. Probably you will need to zoom it more so you will see the difference sometimes when the levels are very close to each other.

The red candle, the spike below the candle, is just a little bit above the other one. Which for me is a great failure. Very close to it could be accepted as a double bottom if you want. Even if I’m not a fan of these old patterns.

The impulsive break is what we are looking for

And then what happened, the price broke aggressively. There’s an impulsive break, impulsive break actually of the counter trend line and the recent high with one candle.

Impulsive break.

So this is really the impulsive break, this is what I’m looking for, the impulsive break of the price. It breaks the counter trend line and it breaks the recent high. And at the same time, it closes on the extreme. This is a great Bitcoin trading example that I can give you.

What means an impulsive break in price action trading?

  • long bar
  • close on extreme
  • crosse important level
  • huge volume

On the break of the counter trend line, I have entered with 33.3% then on the break of the recent high, I have entered the 50%. And what’s interesting is that the EMA cross came later. So 16.6% came after the other 2 entries.

At the opening of this bar, what happened, the price broke. I entered 2 times, the EMAs were not crossed and then they crossed over here so I entered on the opening of this bar with the 16.6.

price action trading situation
The opening of the bar.

Keep your chart simple.

Now, obviously the Stop Loss was below the recent lows. Now, I could have kept them but that’s quite a huge distance. So if the low was closer to those, probably I’d have placed it just below it.

But this is a huge distance. I didn’t want to give such a huge Stop Loss, so I have placed it below. It’s below the 9,000 of round number which is great. So my Stop Loss was at 8,940. Below the 950 round number.

And then what happened, the price continued higher. I had the envelope, of course, to take the profit of the 33.3% position, and let me just place it over the chart. I just remove it when I’m not using it because I really want to keep my chart more simple.

And the envelope is quite huge by default. Let me just change it very quickly. So we said that for the envelope we are using the inputs of the length of 5 and the percent of 1.

The inputs.

The round numbers matter in Price action trading.

And then for style, I have used green. So it’s the length of 5, percent of 1.

And what happens, you can see that the price here was very close to the envelope.

The price gets close to the envelope.

However, on this candle, there was a touch. So I have taken the profit, this is the profit from the break of the counter trend line right at 33.3%.

Let me remove now again the envelope so it will not mess too much the chart. And then the price just continued higher. My Stop Loss was trailing behind.

You can see here, we have a higher low confirmed when the price broke this high. So my Stop Loss came here. Then it came here and then it was really hard to trail it because the price just went straight up.

It went above 10,000 actually right over here with this huge candle. So this is what I’m talking about, the round numbers. They really matter. You can see how the price goes towards 10,000.

Take Profit and Stop Loss are must if you are a beginner trader

And the moment it broke 10,000 and just went like a rocket up. Once the 10,000 is broken, it just went straight up with over $700 just for 3-4 hours.

However, my Take Profit, the second Take Profit that I have from the previous Fibonacci, so this one was still not available at this moment. I didn’t have this Fibonacci at this moment. The second Take Profit was at 10,464 is the price and I had the Take Profit at 10,440.

The second Take Profit.

Again below the 50 even if the price went higher, this was a really great move that I got here. This was the Take Profit of the 50% of my Bitcoin trading example trade. And then my Stop Loss was below the recent low

Trailings Stop Loss is useful in Price action trading.

And then I really didn’t have a place to trail the Stop Loss so for the rest 2 positions, I kept it there. This trade was closed, the 50% was closed. And I had the last one with the 16.6% remaining and the Stop Loss was still right here.

Bitcoin trading example
The Stop Loss.

Then you can see what happened with this Bitcoin trading example. The price failed to take this high which gave me another opportunity of a counter trend line.

But I moved my Stop Loss for the last position over here below this low, just when this high was broken. And it was broken at this moment from the spike of this candlestick. And actually, when it was broken, I have moved it below the low.

So I kept this last trade for much longer. My Stop Loss is below this recent low. You can see above I don’t have another higher low to move it. So the price during the night reached nearly 13,000.

The last trade.

A long candle talks about in Price action trading.

You can see again the round number matters, it bounced from 12,960, something like that. It couldn’t reach 13,000. And my Stop Loss for this last trade is still there.

Of course, if the price reverses down to 11,000, actually it’s below 11,000 as it’s a round number. It is at 10,990, but I consider it below the low.

So if this 13,000 had broken, I would move the Stop Loss. And I have the very same thing for the 3 new trades that were opened. So here at this counter trend line, I had another Bitcoin trading example.

While I had my last trade remaining, I had another setup and I used it. You can see here I have a counter trend line, the price failed to take the low. It is like a really perfect situation for my system.

The price fails to take the low, we have an impulsive break. Even if it didn’t close really on extreme, you can see that there was a small spike. But still it’s a long candle, crosses the counter trend line and here I had the entry.

The entry.

Exponential Moving Averages will be used in this Bitcoin trading example.

Now, after that the price just retested, the counter trend line continued higher, the cross of the Exponential Moving Averages happened. And on the opening of the next one the cross was confirmed and here was the 16.6. So the 33.3 was here with the break of the counter trend line.

And on the opening of the next one, I had the 16.6 because of the cross of the EMAs.

Bitcoin trading example
The cross of the EMAs.

This is the most recent high. On the break of it, you can see again an impulsive break. This is exactly what I’m looking for, impulsive breaks, I had the 50% of the position.

So my Stop Loss was initially below this low. Then when this high was broken, it moved below the low. Then when the price continued higher when it reached the highs, I trailed it over here and then it is on the same place as I showed to you for the other trade right over here below the 11,000.

The second Fibonacci is my Take Profit

I  moved the Stop Loss here after this high was broken. So we have a confirmed higher low.

Let me show you once again where was the Take Profit and I will start with the Envelopes.

The Envelope.

Let me just make it quick. As I said, I’m using length of 5 percent of 1, I click on OK.

And you can see right over here I had the entries and the exit was really quick.

Actually, the break of the recent high where I had the 50% went straight out of the envelope.

Bitcoin trading example
The break of the recent high.

And this is because really we have impulsive moves from the Bitcoin recently. So this trade was pretty quick, the 33.3%.

But you can see where was my 50% the biggest trade, this one over here that breaks. It was on the second Fib at 12,190. 12,207.86 is the second Fib with to 1.618. But I have placed the limit at 12,190.

The Bitcoin is going up. And there willl be many opportunities as this Bitcoin trading example.

Again, below the round number of 12,200. And then with the last 16.6 which actually here again came after the break of the counter trend line.

So, in this Bitcoin trading example, it was the break of the counter trendline, the cross of the EMAs and then the 50% trade which is the break of this recent high, which is still opened. So I have 2 trades open with 16.6% and the Stop Loss is here for both of them. And the price now is at 12,640.

So this was a little bit longer post but I wanted to share with you my other 2 setups Bitcoin trading examples that I had with the system. The Bitcoin is really going up and it’s a great opportunity to use it. The most important thing is to stay strict with the strategy you follow.

Learn to take the profit!

No matter this one or any other, I stay really strict with the system. Because I don’t know what will happen in the next moment. And the most important thing in times like that when the price just goes upwards and it gives us great opportunities is to learn to take the profit.

Don’t be afraid to place a limit and to take your profit. I have hundreds and thousands of students already. Many of those shared with me when the price of the Bitcoin last year reached 19,000.

They were keeping their trades hoping it will go more and they didn’t take any profit, then the Bitcoin just crashed together with all the cryptocurrencies. Many people lost their money and savings. They just panic and they closed the trades on losses.

So they took the Bitcoin at a good price, hold it for some time, but because they were hoping to get more and more profit, at the end many people closed the trades and sold the Bitcoins on a loss. Because they panicked that they will lose all their savings.

Whether with this system or another, place your limits.

So what I really want to teach you with this course and with the system, is to learn to take your profit. Keep something in mind

You are not going to lose if you take profit. You saw that in this Bitcoin trading example.

Place your limits, doesn’t matter with this system or anything else.

If you use the Fibonacci, or some envelope, or anything that you want to use, or the round numbers, if you take profit and you make some profit in your account you will not lose from that. Of course, it will happen that the price will continue higher as you saw with my examples.

I could have made much more if I had kept all of these trades till at the moment. But of course, I don’t know if the price will go more upwards.

No expectations, no hope, no feelings.

I follow the system really strictly. I have very precise entries and exits with the counter trend line, with the recent high and I have my levels where I take the profit. And at the end in my live accounts, I did some really great profit.

But if you’re really a beginner trader I don’t suggest you risk on the live account.

Watch the complete course Price action trading course: Bitcoin and the Cryptos

Test it always on a Demo, practice first make sure you are confident with the system and you know the details. Of course, you’re very welcome to change anything which you think will be better for you and you will feel comfortable with it.

Thank you very much for reading, if you have any questions don’t hesitate to ask me.

Petko Aleksandrov