How to Generate Bitcoin Signals with Bitcoin Trading Systems Strategies
Crypto Currency MT4 Signal Indicator
The sole method for trading bitcoin is through signals. It is advisable to learn how to generate these trade signals independently, thereby eliminating the need to depend on others for signal generation.
Generating bitcoin signals isn't easy & requires you to have a lot of cryptocurrency trading analysis knowledge & experience, but the earlier you begin practicing how to generate these signals for yourself the better it's for you.
A good technique of how to practice generating bitcoin signals with bitcoin systems is to open a free practice Bitcoin demo account & test out your signals on the practice account risk free without risking your money, then once you've tested your bitcoin strategies & they are profitable on the trade practice demo account you can the use these bitcoin signals on a live account.
Below, we'll talk about how to practice creating these signals and how to test the bitcoin signals using a fake bitcoin account with MetaTrader 4 software.
So, How Can One Generate Bitcoin Signals?
The best technique of generating bitcoin signals is through bitcoin systems, You can Learn how to come up with bitcoin systems from the guide how to create Trade Systems on the right navigating menu under the courses Bitcoin Key Concepts.
A system is a combination of 1 or 2 or more crypto indicators with written rules of how these crypto indicators will generate these bitcoin signals.
Take an illustration of the simplest trading system or strategy referred to as moving average(MA) crossover method. A buy cryptocurrency signal or sell cryptocurrency signal gets generated when there's a cross over of the two moving averages: either a buy cryptocurrency signal for an upward moving average crossover or a sell cryptocurrency signal for downwards trend.
Generating MetaTrader 4 Free Signals - Crypto MT4 Signal Indicator - Bitcoin Signals MT4 Indicator Strategy Moving Average(MA) Cross over Method
The example below shows a bitcoin trading system that combines the MA strategy with the RSI and MACD indicators to help you find buy and sell opportunities.
Example of Generating MT4 Free Signals - Crypto MT4 Signal Indicator - Bitcoin Signals MT4 Indicator Strategy Method
To create buy and sell signals, use simple bitcoin systems. They produce these bitcoin signals.
Generating MetaTrader 4 Free Signals - Crypto MT4 Signal Indicator - Bitcoin Signals MT4 Technical Indicator Method - Buy and Sell Signals
Generating MetaTrader 4 Free Signals
A functional example of a straightforward btcusd system involves the amalgamation of the following components:
- Moving Average(MA) crossover method
- RSI
- MACD
The written bitcoin rules are:
Generating Bitcoin Signals Strategy System Examples
Bitcoin Trade Rules:
Buy Bitcoin Signal is Generated when:
- Both Moving averages going upward
- RSI above 50
- MACD above centerline
Sell Bitcoin Signal is Generated when:
- Both moving averages MAs going downwards
- RSI below 50
- MACD below center line
Generating Buy and Sell Trades - Examples of a Method
Exit Signal
Exit when MA, RSI, and MACD shift against the trend. These crypto indicators signal the move.
The crypto chart time-frame to use is 1 hour chart time-frame or 15 minutes chart timeframe based on what type of trader you are.
For a beginner bitcoin trader the above written rules will give good buy & sell bitcoin trade signals, the only thing which a trader needs to do is to have the discipline to follow the written bitcoin signals rules the exact way they are, & wait out for a buy/sell trade position to be indicated by your bitcoin strategy & trade after the signals have been generated, not before they're generated.
Back Testing
Generating Trade Signals with a system is one of the easiest method to trade bitcoin, it is the best way that a beginner trader can attempt to figure out the direction of the market price bitcoin trend with a good level of accuracy, & with a little backtesting on demo account so as to continuously increase the level of accuracy of this bitcoin signals strategy
To effectively back-test a BTC/USD cryptocurrency strategy, adhere to these two steps:
- Paper Trade
- Crypto Currency Demo Trade
Bitcoin Paper Trading - This method of testing a bitcoin system involves placing your system on the charts, then take the chart back to a particular given date, 3 months back e.g., and then using this chart history to figure out where your bitcoin strategy would have generated buy, sell & exit signals. Write down these points & the profit per trade transaction on a piece of paper and then calculate the total profit after you've recorded a good number of trades like 50 paper trade positions bitcoin transactions & determine if your method/technique is overall profitable, the win ratio, the loss ratio and the risk:reward.
That old-school way of testing strategies? Same story. Before online platforms, traders got out their graph paper and drew everything by hand. Every single chart - daily, hourly, you name it. Think you'd want to do that? Probably not. But those folks were dedicated, and a few still stick to their paper charts. For our purposes, just use a sample of 50 trades to try out the paper method.
A good bitcoin tool to use to back-test your system is known as the MT4 BTCUSD Crypto Step-by-Step Tool. Found in MT4 charts tool bar of MetaTrader 4 software, If you want to find the charts tool-bar on the MetaTrader 4 it's at the top of MT4 software. If it's not: Click View (next to file, left top corner of MT4)>>> Tool Bar >>> Charts. Then click Customize button >>> Choose Bitcoin Step by Step >>> Press Insert >>> Close.
MT4 Bitcoin Platform Chart Tool-Bars - How to Trade Bitcoin for Beginners
MT4 Chart ToolBars - Bitcoin Step by Step Button Key for Back Testing Bitcoin Systems Discussed
After you install this MT4 tool, you are able to rewind your trading chart, and use this MT4 tool to carefully advance the crypto charts to test if your bitcoin system would have determined and produced either a buy or sell order, and pinpoint where you would have ended the BTCUSD order, then record the amount of gain or loss for each bitcoin order and based on the number of bitcoin orders you'd then compute the total gains and losses made by the strategy.
If your bitcoin strategy is profitable on the paper method then, it's time to demo btcusd trade & testing if the it's profitable on real market as it's on paper technique. This is the process of testing or backtesting a system.
Writing a BTC/USD Crypto Trade Journal
Maintain a BTCUSD Journal to monitor profitable bitcoin trade positions, and determine why these trade positions were profitable. And also keep a log of all losing trade transactions, determine why these trades made a loss & then avoid making these same mistakes the next time that you trade using your trading strategy.
Tweak your btcusd system until you get a good risk to reward ratio, with bitcoin signals which you generate. Aim for a good risk:reward of 3:1 and a win ratio of above 70 % is a good ratio, with good bitcoin money management even a bitcoin strategy with a win ratio of even 30% i.e. Less than half of your bitcoin transactions make profit you can still make a profit. You may want to read and study this lesson to know and learn what the illustration below is talking about: Risk Reward Ratio.
Risk-Reward Ratio Chart of Bitcoin Trade Money Management Strategy - BTCUSD Trading Strategies Described
Read Bitcoin Money Management Methods Lesson
A bitcoin system done by a person is still the greatest way to create bitcoin trading signals compared to using automated systems: a trading plan done by a person is a better way and is also easier to do.
However, other traders prefer automated bitcoin systems & for those then they can check the info on this page MQL5 Crypto EAs and automated bitcoin systems.
You also can view our extensive list of bitcoin trade strategies topics that offers you with various methods of buy & sell trading analysis using a number of diverse trading methods, navigate to Bitcoin Trading Strategies Section.
Learn More Tutorials:
- How to Identify BTC USD Trends in BTCUSD Chart
- How Can You Display BTC USD Chart Timeframes in MT5 Platform/Software?
- BTCUSD Charts Analysis in BTC USD Trading Definition
- How Can You Open Live BTCUSD Account with $10?
- What is Morning Star BTC USD Candles in BTCUSD Trading?
- Best Trend BTC USD Technical Indicators
- How Can You Open Live Bitcoin Trade Account with $30?
- How to Trade BTC USD Trendline Signals in Bitcoin Trading
- Accelerator Oscillator BTC USD Technical Indicator Described
- Learn BTC/USD Analysis Step By Step Lesson Tutorial
