Trading the 130% increase of Ethereum
Cryptohopper Newsletter
Chart
Ethereum has had an astonishing 132% growth from the beginning of 2020 to its highs on the 15th of February when it reached 290$. However, now the bears are in control of the market as the coin has already lost a quarter of its value from this year's high.
After this year’s highs have been reached, the price consolidated for a few days before selling off. However these type of corrections are natural as traders reap their rewards by taking their profits. The price is currently at the important 220$ support level which is currently holding, in the case it breaks the price probably retrace to the 190$ support.
For this week’s analysis, we have selected a trend indicator to ensure that we only trade with the trend, and a momentum indicator to find the pullbacks of the uptrend.
Let’s take a closer look at this strategy and its performance on the ETH/USD market!
Designing your automated strategy
For this week’s analysis, we have selected 2 indicators Williams% and the Mesa, which when used together provide an effective strategy that can be used on Cryptohopper.
The MESA adaptive moving average is a trend-following indicator. It adapts to price movements in a very unique way, based on the rate of change (ROC). Like other moving averages, traders use this indicator to spot trends and trend reversals. This is done by crossovers between a fast and a slow-moving average. The MESA will indicate a buy signal the entire time the fast moving average is above the slow one and a sell signal when the fast moving average is below the slow moving average.
Now let's look at the momentum indicator, the Williams%. This indicator determines overbought and oversold zones, which oscillates between -100 and 0. The indicator compares the highest and lowest point within a number of periods. The overbought zone is between -20 and 0 and this where the sell signals are given. The oversold is between -80 and -100 and this is where the buy signals are given.
Combining the two indicators will result in a strategy that provides signals only when both trend and momentum are on the same side. This will result in a strategy that will only provide buy signal during the pullbacks of an uptrend, ensuring that you always trade with the trend.
Chart
Ethereum has had an astonishing 132% growth from the beginning of 2020 to its highs on the 15th of February when it reached 290$. However, now the bears are in control of the market as the coin has already lost a quarter of its value from this year's high.
After this year’s highs have been reached, the price consolidated for a few days before selling off. However these type of corrections are natural as traders reap their rewards by taking their profits. The price is currently at the important 220$ support level which is currently holding, in the case it breaks the price probably retrace to the 190$ support.
For this week’s analysis, we have selected a trend indicator to ensure that we only trade with the trend, and a momentum indicator to find the pullbacks of the uptrend.
Let’s take a closer look at this strategy and its performance on the ETH/USD market!
Designing your automated strategy
For this week’s analysis, we have selected 2 indicators Williams% and the Mesa, which when used together provide an effective strategy that can be used on Cryptohopper.
The MESA adaptive moving average is a trend-following indicator. It adapts to price movements in a very unique way, based on the rate of change (ROC). Like other moving averages, traders use this indicator to spot trends and trend reversals. This is done by crossovers between a fast and a slow-moving average. The MESA will indicate a buy signal the entire time the fast moving average is above the slow one and a sell signal when the fast moving average is below the slow moving average.
Now let's look at the momentum indicator, the Williams%. This indicator determines overbought and oversold zones, which oscillates between -100 and 0. The indicator compares the highest and lowest point within a number of periods. The overbought zone is between -20 and 0 and this where the sell signals are given. The oversold is between -80 and -100 and this is where the buy signals are given.
Combining the two indicators will result in a strategy that provides signals only when both trend and momentum are on the same side. This will result in a strategy that will only provide buy signal during the pullbacks of an uptrend, ensuring that you always trade with the trend.
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