Scalping On The Crypto Index – The «Favor» Strategy
The development of the crypto market as an innovative direction for investing funds led to the emergence of new assets for trading with urgent bids. A typical example is a crypto index, which some binary option brokers started to post in listing of their platforms.
The crypto index is a composite indicator of the cost of a package of basic digital coins (are ccryptocurrencies a scam?). Taking into account that in the algorithm for calculating the price of the index the average values of crypto assets are used, we obtain a trading instrument chart that boasts a smoother construction mode than the volatile liquidity indicators of digital coins themselves (how to get money out of cryptocurrency?). Here, there aren’t any impulse candles with long shadows or large gaps enabling to trade contracts with a small repayment period. We offer you a scalping strategy «Favor», which, due to a set of trend indicators, is capable of generating high-performance signals for processing short-term lots on quotations of the crypto index.
How does the system work?
To apply the strategy, first of all, it will be necessary to select an operator that can offer the necessary asset (the crypto-index) within its trading service. We advise you to take advantage of the Binomo trading terminal. It’s a nice solution for urgent trading. Apart from the required asset, traders can count on a set of analysis tools, which are used to form the working template of the Favor system.
Next, open the chart of the CRYPTO IDX asset, activate the 15-second timeframe mode and apply the following technical indicators:
- MA 3-exponential with a technical market assessment period of 30, the color of the indicator line is standard.
- MA 3-exponential with a technical market assessment period of 20, the color of the indicator line is yellow.
- MA HULL with a technical market evaluation period of 60, the color of the indicator line is light blue.
- MACD in the tool service settings, set the oscillator periods to 30/60/9.
We’re going to use trend analysis indicators as a means of assessing a wide range of the market and generating signals for the strategy for processing short-term bids. Within the strategy the MACD auxiliary oscillator will be used to filter technical signals and confirm the main trend of the market. Thus, we will achieve high accuracy of forecasts for trading in futures contracts and obtain maximum results.
Having installed and configured the system indicators on your working chart, you’ll get the following layout:
Signals for trading
To open the lot UP, you need to identify indicators of the following format on the trading chart:
- As a result of the dynamic movement of the market the red and yellow lines of the indicators MA 3-exponential crossed the blue level of the instrument MA HULL upwards.
- The oscillator filter of the signals should form the intersection of the upward moving averages with the subsequent active divergence of the lines between each other.
Having received the specified set of indications of the system, you can open a short-term lot up:
In order to open a lot of DOWN, you need to identify indicators of this format on the trading chart:
- As a result of the dynamic movement of the market the red and yellow lines of the indicators MA 3-exponential crossed the blue level of the instrument MA HULL down.
- The oscillator filter signals in this case should form the intersection of the moving averages downwards with the subsequent active divergence of the lines between each other.
Having received the specified set of indications of the system, you can open a short-term lot down:
In order to steadily derive revenue and effectively execute trading forecasts of the strategy, it’s recommended to use lots with repayment of 240-300 seconds in your trading. Thus, in the scalping mode, you will get a high trading dynamics and capital growth.
Trading in urgent birds with a minimum repayment rate is extremely risky, therefore, in this mode you’d better apply strict limits on the level of risks. In this case, you should use bids in which the amount of funds involved won’t exceed 3% of the amount of your capital. If your deposit doesn’t allow working in this mode, shift to contracts with a minimum cost.