⚡Strategy "Energy of the market"
Last updated
Last updated
In the left panel of the terminal, click on "New tab".
In the window that opens, select the connection to the exchange, the ticker and the "Candle chart", then click "Apply".
Now you need to configure the graph itself, to do this, at the top of the panel we find the "Basis settings" next to the "Display settings" panel
We set the following settings for the chart, as shown in the screenshot below:
IMPORTANT! In this case, we take the price for a constant, that is, for a constant value, in order to track the energy in each bar that travels the same distance!
We have set up the chart so that each candle passes the same price range, and more specifically 100 points ($10).
IMPORTANT! The unit of measurement for the "Price range" parameter itself will be different depending on the traded instrument, namely its volatility. For example: on BTC, the optimal value of the price range will be 500 points, and on 1000PEPE, this value will be 100 points!
There is an indicator in the lower part of the candle chart, for this strategy you will need the "Intensity" indicator, to select it you need to click on the "+" window and select the indicator of interest, after which, remove the extra primary indicator by clicking on the cross in the upper right corner of the indicator panel itself.
Intensity - indicator that shows the energy of price movement for each bar at a certain point in time.
The value of the bar histogram!
Green column - energy of the price movement that took place on the ascending bar.
Red column - energy of the price movement that took place on the descending bar.
After setting up, the workspace should look like this:
Pivot points are mainly characterized by increased activity (intensity) of trading, that is, in such places the market dynamics increases noticeably, and if the price goes the same distance with each candle and the intensity changes, then this indicates a change of interests on the part of buyers and sellers.
The main idea of the strategy is to identify a place where the intensity has changed dramatically and at the same time the price has begun to change its direction.
Next, we will analyze the strategy over a certain time interval and show its practical application using the example of specific transactions.
It is necessary to find a situation in which the price changes its direction and the intensity increases with each subsequent candle in the opposite direction.
Additional criteria!
It is important that the intensity changes to a higher one at the pivot point - this increases the probability of a true reversal!
Before the reversal, it is desirable that the intensity gradually decreases, but only on those candlesticks where the market is directed!
Sudden bursts of intensity form a level from which a reaction or the formation of a balance can probably be expected!
A situation in which the intensity at the pivot point has changed to a large one is a true reversal.
A situation in which the intensity fades before the pivot point is a true reversal.
A situation in which there is a strong spike in intensity (compared to previous values) will indicate a strategic level from which a reaction can be expected.
With a surge in intensity, a strategic level arises, to which the price then comes
When approaching the level, the intensity decreases
After the intensity decreases, a reversal point is formed, at which the intensity begins to increase
After the pivot point, you need to wait for directional movement with increased intensity
Fixation at the level of the double size of the impulse movement at which the input was performed (the last criterion of the ideal EPD).
If the price range is set in the chart settings, for example 100 points, then in the forming model of 3 candlesticks the size will be 300 points, so from the entry point to the take profit the size will also be 300 points.
Fixation at the level of an obvious extreme.
Closing a position at the level of an extreme burst of intensity.
In an arbitrary period (2 hours), 4 transactions were made, all of which turned out to be profitable.
The blue circle is the entry point, the green circle is the exit point (take profit), the red line is a potential stop loss, the green line is a potential take profit.
The trading result on this site in 2 hours = +1.8% to the deposit, excluding leverage.
Win rate of this strategy, based on the market structure and large-scale backtest, is 80%, since there is trading in the direction of the trend.
You can use this strategy both independently and as one of the filters within a variety of trading strategies used by traders.
IMPORTANT! Trading involves risks. The User is solely responsible for actions or omissions when using the described trading strategy. This strategy and its description are for informational purposes only. The information provided here is not an individual investment recommendation. News, articles, expert comments, research, forecasts and other information are presented without taking into account any specific investment profile, and the mentioned financial instruments or transactions may not correspond to the profitability expected by one or another user of the product, the investment horizon, as well as the acceptable risk of losses for one or another user of the product. Company 1EX is not responsible for possible losses in the event of transactions based on the described strategy or investing in financial instruments mentioned in this publication.
