[Trading With BICHI Indicative Strategy / Introducing IDX] -Steemit Crypto Academy | S5W6| Homework Post for @utsavsaxena11
BICHI INDICATIVE STRATEGY
Generally, trading in any digital asset requires a great learning and studying as well as a lot of regular practices so as to be profitable each and every trading day. Trading have been made easy with a lot of trading tools and instruments that are very much available on each trading platforms, depending on your own basic understanding and knowledge.
Some of the indicators which can be used are but not limited to: Bollinger bands (BB), Ichimoku, Moving Averages, relative strength index and so on. One of the profitable strategy in the market as it was introduced in in this topic this week is the BICHI strategy is a strategy developed from two beautiful trading instruments and technical indicators, which are, the BOLLINGER (B) and ICHIMOKU (ICHI). These two instruments are unique and if well used can be used to make constants profits from the market.
The Bollinger bands were invented by John Bollinger and hence the name, Bollinger Bands- serve as an indicator for support and resistance in the market. It is a form of technical analysis and is very helpful and useful for traders in knowing when to enter or exit the crypto market by indicating and showing position of overbought or oversold whereas Ichimoku cloud indicator shows the future trends in the market. So as to know as a trader the possible movements in the market (uptrend or down trend) and to act profitably.
UPTREND
Uptrend is a term used to denote the increase in price of any cryptocurrency pairs over a certain period of time.
From the screenshot above, on a 15min BTC/USD chart, it could be observed that the candles broke out of the clouds and the prices were far more above the basis line, this indicates much buying power.
DOWNTREND
Is a termed used to represent an oversold signal indicating sellers pressure on a cryptocurrency pair.
When this trend appears in the market, it is an indication that the market is been dominated by the sellers and therefore, a sell trading action is required.
From the screenshot above showing ETH/USD pairs, it could be seen that the cloud was far above the prices, indicating a strong sell in the market and also the basis line is also above the candles.
Trend reversal
Trend reversal occurs when an uptrend changes to a downtrend or vice versa, that is when the market which is going bearish or bullish reverses its position and goes the opposite direction. And with the help of the Bollinger bands, it’ll help to track the movement of prices.
From the screenshot below, it would be observed that the Bollinger bands and candles showing the price movements are down and then, the market went sideways, that is, there was no significance differences between the selling and the buying pressures and then, the Ichimoku clouds breaks off which therefore signified a later uptrend in the market.
Demo trading:
Using an ETHUSD pair in the 15min time frame, it could be seen from the screenshot below that the price is well below the Bollinger bands, showing a downtrend and indicating a sell in the market. The stop loss was set to touch the basis line which provides resistance to the price of the pair and the trade execution started from the the next candle after the break out of the ichimoku cloud and the take profit was set at an appropriate level.
My view on BICHI indicative strategy
It really is a very good strategy because of the fact that it is a combination of 2 great indicators, like a saying: “two good heads are better than one”. As I’ve learnt from this module, I’ll make sure I practice this strategy well and makes the good use of it each and every day I enter the market to trade and I’ll make sure I teach some of my friends too (lols).
WHAT IS CRYPTO IDX?
Crypto IDX is an acronym which stands for Cryptocurrencies index. Let’s first get down the meaning of an index. It is a way of representing the ratio objects, in this aspect, cryptocurrencies mathematically and how the price is moving whether, it will go bullish or bearish. Also, crypto IDX is a market capitalization which is based on average price of top cryptocurrencies by monitoring the prices of thosecrypto currencies and relating them together by forming a kind of mathematical uniformity among them and predicting how their prices would move taking into consideration the forces of demand and supply of the cryptocurrencies.
WHAT IS ALTCOIN IDX?
Altcoin IDX shows how various cryptocurrencies prices change with fiat currencies. Due to its volatility, It provides crypto traders with a lot of trading options.
Furthermore, this trading instrument (ALT IDX) was first used in 2017 as a response to the global community of the crypto traders. The main function of this instrument is that it makes traders to observe the trends in the market thereby able to predict the next trend(s) in the market. It involves prediction of the prices in the market, if the prediction is correct, the differences between the ask and bid prices as at the time of opening and closing will amount to the total profit.
But, it is necessary to know that, if a trader makes a wrong prediction and loses his money, the money cannot be refunded or paid back. And so, traders who are into this type of trading need to be very careful and use necessary tools in order to avoid loses.
SIGNAL PREDICTION TRADING
Signal prediction trading is a type of trading in which traders forecast the movements of crypto IDX and/or ALT IDX, that is, it is a kind of trading method whereby people put in their moneys and place an option of whether cryptocurrencies prices will go up or reduce in its price, a correct prediction means a higher return and a wrong prediction would result in a loss. Some of the software and applications used in prediction trading are crypto signals, sha of crypto, binomo and so on.
The question of if it’s legal in my country- yes, prediction trading is legal in my country because binomo- an applications that can be used to make such a trade is made available to use in my country and it accepts Nigerian currency (Naira) as a method of payment which is an indication that an account can be operated with the same currency. See the screenshot below;
PENNY CRYPTOCURRENCIES
It is worth to know cryptocurrency market is fast expanding each and every day. Since the launch of BTC some years ago, many other coins have been given birth to and there are over hundreds of cryptocurrencies that are currently being traded. Penny currencies are just like any other coins out there but what makes them unique is the fact that they are digital assets whose value is less than $1.
Though, it’s thoughtful to note that Mr. A who wants to venture and invest into the market may not have the capacity to purchase 1BTC, but may be advised to go for a better project of a lower value which may yield a higher in some months or years to come. One of the reasons why people go for penny cryptocurrencies is that: they are at first when launched, have a very low value so as to attract investors and if the good of such coin is good enough, the demand for them will increase and as well the supply will also go up.
It is also a means to diversify ones invest in the crypto space, as it is not advisable to put all eggs in the same basket, one may after going through a project’s white decide to invest in such a coin and expects constant returns later.
If I were to go for penny cryptocurrencies, I’ll go for the following penny crypto currencies:
RIPPLE (XRP): It is a very popular penny cryptocurrency in the crypto market, it was launched in 2012. It was created to serve as a network which performs transactions faster and as well, being cost effective. It allows transaction processes at the rate of 1,500 transactions per section, which is far greater than that of Bitcoin.
STELLAR LUMENS (XLM): This is one of the cryptocurrencies with over $531 million trading volume, it also allows for faster transaction processing time. It also has a complex algorithm known as the Federated Byzantine Agreement (FBA) which enables the faster rate of transaction and transaction confirmation.
CARDANO (ADA): This is also one of the penny cryptocurrencies that I’d go for because of the following interesting fact about the asset.
It was founded by a co-founder of Ethereum, Charles Hoskinson. It was launched to address some challenges associated with some other cryptocurrencies, that is, scalability, sustainability and interoperability.
- CRYPTO.COM COIN: it is a coin developed on the crypto.com chain, it is decentralized and an open source blockchain. It was created so as to accelerate the global adoption of cryptocurrencies, that is, to make more people enter into the crypto market.
CONCLUSION
In conclusion, it is necessary and required of every trader to learn and understand the usages of more than one indicators. The combination of these indicators and instrument is not only helpful but as well profitable. One of those is the BICHI INDICATIVE STRATEGY as it was highlighted in this module. It’s been shown that, a proper knowledge and application of this strategy will yield nothing but positivity and productivity for every trader who makes the use of it.
Also talked about was the world of penny cryptocurrencies- cryptocurrencies of values less than one dollar.
Though they might not be as populous and as traded as the big cryptocurrencies like the BITCOIN, ETHEREUM and the likes but the good ones among them have a very high potential of yielding a better profit if well taken care of properly.
They also serve as a means of diversifying one’s investment in the crypto space, as it is not advisable to put all moneys into a single coin, because of possible unforeseen, unfortunate circumstances that might occur but having more than 2 penny cryptocurrencies might be a better option to getting more profit in the crpto space. And lastly, the cryptocurrency index and alt index (CRYPTO IDX, ALT IDX) is a method of forecasting the movements and trends of cryptocurrencies by observing the past trends in the market and if well mastered and utilized carefully can be used to earn massive profit in the crypto space.