Where to Buy

One should know when to open a buy order, just because the btcusd trading market is bullish and bitcoin prices are heading upward it does not mean you as a trader can just buy anywhere. You need to know art of where to open a buy order.

Consider this, the btcusd trading market is bullish you come and buy at the top of the bitcoin trend where the bitcoin prices look so bullish that it creates the illusion that the btcusd trading market will never retrace and if you do not buy now you will be left behind, only that just after you buy the btcusd market immediately retraces 200 pips. This is not the art of how to buy. Even if the btcusd market goes up & the btcusd market price returns to where you bought you are still not in profit, you have done zero work and you've just wasted your time. You need to know where to buy at the best bitcoin price & at the best time so that as the btcusd trading market does not retrace on you just when you have bought.

The chart below shows an upward trending market. It shows where many BTCUSD traders buy, most traders buy when the upwards market is looking obvious, this isn't where to buy, you buy when the bitcoin trading market bitcoin trend is not looking obvious, this is when there is a retracement in the bitcoin price. Always try to buy after a price retracement like shown below.

The art of this type of buying is which you buy after a retracement, henceforth even if bitcoin price does not move up immediately, the market retracement will already be played out halfway or 3 quarter way, henceforth instead of you entering a buy position which retraces 200 pips as in the case that you buy at the top, you buy after a retracement therefore even if bitcoin price were to retrace on you it will only retrace a few points and once the bitcoin trend resumes you'll make profit much faster.

For example if you buy after the bitcoin price has retraced 150 points and the total retracement is 200 points, then your buy trade position will only retrace on you by 50 points instead of 200 pips. And by the time the upward bitcoin trend resumes and bitcoin prices moves up 200 points to clear the market retracement at this point you'll be 150 points in profit, thus you'll have saved time as well as by entering at the best point you will make money on the market retracement. This is the art of buying if you want to make money when trading an upward trending market.

The example shown below shows where to not to buy and where to buy after a retracement, the buy was quickly confirmed by the moving average which started to move up & RSI went to above the 50 center line mark. Buying here after the price retracement shows as a bitcoin trader your position did not have a lot of draw-down and you started to make money immediately henceforth making this a low risk trade.

Where to close-out buy orders

Knowing where to buy also means knowing where to close you orders & take profit.

For the above setup we will be using the RSI over-bought signal. Once the RSI goes above 70 & then close below this technical level we shall consider this as a sell cryptocurrency signal and we shall close out all open buy orders.

And then wait for another retracement and open another buy trade after a retracement and repeat this strategy.

We shall take a screen shot of this trade to show you where to close the orders after the btcusd trading market moves up as these trade is real time at the time of writing this article.

Where to buy again

Because the bitcoin trend is upwards and we only buy after a retracement then as a buyer you'd have waited for the setup to buy again and this is after a price retracement.

This would have been best place to buy as this is the level where the prevailing market is oversold.

You also can wait for confirmation of the above signal like is shown below:

Buy trade set-up confirmed

What if a Trader Buys and The Retracement Continues Downward?

This is a good question, what if where you buy isn't where the market retracement stops and the down move continues?

This trade did just that & retraced 200 points down from our buy point such as illustrated below.

So the first thing to know is that this is an upward bitcoin trend & the price retracement has moved 671 pips from the top but using our strategy we've been caught by only 200 pips(points) instead of the 671 pips. This is the first reason why you should not buy at the top & instead wait for a retracement then buy. That way you'll only be caught by a fraction of the market retracement & not the whole retracement, therefore saving you from a lot of drawdown on the position.

The next step is that because you will not be over leveraging your positions you will still have enough money to absorb the drawdown. You will then open a new trade position after this retracement begins to move upwards like illustrated above.

From above trade setup our newly opened trade position went up by 70 points immediately after opening this trade. As a trader you will need to close-out these new trade positions at the earliest times so that as you as a trader can reduce your risk and at the same time book some profit amidst all the retracements happening.

For this trade our take profit will be set at 1144 or we monitor the bitcoin price chart and close-out this trade if the force of this trades begins to slow-down.

We shall take a screen shot of this trade after the btcusd trading market bitcoin trend has developed.

The buy bitcoin trade was confirmed after there was a consolidation - both moving averages are now heading upwards and the RSI indicator is above 50. There was even a short term downwards bitcoin trend like as illustrated by the downward bitcoin trend line that now has been broken.

As a trader you as a trader can see that using our strategy we have been able to reduce our drawdown despite the short term down btcusd trend. Should the btcusd trading market go up to where our first trade transaction was, we shall have added profit to our account. The reason why we have added this profit won't be because that we were able to perfectly time the btcusd market but because we have entered the btcusd market when the possibility of draw down is very minimal. This means our risk reward ratio is high enough to enable us to extract profit from the bitcoin market using this strategy.

The following area is where you close out your trade, always quit while you are ahead and wait for another retracement to buy.

It is best to close trades here because the btcusd trading market is a little overbought at this particular time. Close trade set a buy limit and wait out for tomorrow.

Based on our trading strategy the best place to set buy limit would be at 1123 or 1122 or 1121 just above 1120.

Just in case there's a continuation of this bullish upwards market, we also set buy stop pending order at 1136 just above most recent high that way our buy bitcoin trade will still be opened either way.

The thing to remember is retracement before buy - the aim is to first reduce any amount of draw-down before starting to chase profit.

The next thing you have to be sure with this strategy is that the current long term bitcoin trend is upwards, that way you're trading with the bitcoin trend - you as a BTCUSD trader can use moving average cross-over method on the weekly chart to do this.

The same concept of retracement before sell can be used to open sell cryptocurrency trades when in a downward bearish trending market.

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