What's going on everyone? My name is Nicolas Burton here at data & # 39. Today is October 8th of 2017. Well, folks, you should keep up with the channel, and you know that from time to time, I like to share a training to appear on the day channel, to help you all better your trading and investing journeys through crypto currencies.
And today I want to answer a question that I got a lot from my last video in the last training tip video. I talked about three signs by three signs to get into a crypto currency to know when a good bison and it's.
Time to make some gains, however, the other important question is when to lock in those games. Let's, say, for example, you follow those trading tips or maybe you did it your own way and you're in the money.
That means you're, you're, doing well in your cryptocurrency position, or maybe you know the topic of stock, so you bought Apple stock or something, and you're up 20 %. Well, that's great, but the question is: when is it time to sell well in the cryptocurrency market? This is a very important question, because a lot of people can get carried away with double digit or triple digit gains in a short period of time, and they can think that the fun money is gonna last forever.
Well, in cryptocurrencies that's, not how you want to think and really you want to apply some kind of technical strategy to really make sure you lock in profits and stay disciplined. So what are those three signs today? I'm gonna go ahead and tell you all today, three common signs I used to know when to lock in profits and sell on positions.
Alright, so let's, go ahead and dive into it. First, one I want to talk about today is the 9 day moving average. Now I know you're thinking, like Nick don't. You always talk about the 50 day the hundred day and the 200 day, and you say too rarely use the 21 day and unless something's in momentum mover yes, this is true.
However, I use the 9 day moving average, not as a level of indicating support, but for fast runners you know a lot of us are investing in things. For example, I could go back through a lot of the momentum.
Movers Stratos o Mesa ago, which we're. Looking at now arc I mean I could list a dozen examples of examples where this type of strategy will work the nine day moving average is a great indicator to lock partial share positions on good runners.
So, for example, in the case of, let me say, go, this was a very fast mover. There was a lot of anticipation coming into it now. This isn't always going to apply, but it applies to around 60 to 80 percent of the fast movers and cryptocurrencies as we can see.
Not only does it usually maintain above in the night naming average, but if it goes below the nine day. Moving average, it's only slightly through the wix's and a way that I use the nine day moving average to lock in positions, and we have to think about it under perspective of buying down in this range.
For example, getting in early on in this case a good way to use the 90 moving average is when it ever dips, whatever it dips below 5 % of the nine day moving average. So, for example, we take a partial share here.
We take a partial share here and once it gets back of course, we want to wait till it gets it back up above as well. Now you can set stop levels. That is something completely kind of arbitrary to what your risk and reward profile is.
It doesn't have much to do with this, though. The main thing to keep in mind is that every time you break that nine day, moving average okay, you sell partial share you lock in some profits. Okay, when you get back up there, that rule will come back to apply again.
If it comes back to that again, you take another partial share, but in most cases once it gets back up against that nine days we've, seen each time it rounds to new highs and then and then eventually you have a decent breakdown away From it, and then you lock in probably your final partial share now, of course, the way to do this is really dependent on how you want us rate it.
Some people want to take fifty percent of that initial time and be like amen. Look I'm up, like you know, 300 or 400 percent on something I'm gonna lock in half of my money, some people won't, say: look, this is gonna go up a thousand percent and I'm gonna lock in twenty five percent.
Really it's, all subjective to how you want to do it and how much your wrist or reward profile is. My initial cell usually consists of around 40 to 50 percent of my profits. Locked in right off the bat and then I break down each and every other kind of partial share.
As I go up the uptrend and of course I raise my stop level as well to cash out all of it in case. If this thing starts really pulling back to lock in my profits, because again you don't want to just be like you know, giving you know all the way up here and then it just crashes down 50 percent.
No, no! No! It's, it's, gonna go back up, and then it goes down below where you bought it. No one wants to get caught, not, but so many people do so again again adjusting your stops, but really the main strategy here is taking partial shares.
Once a cryptocurrency goes below the 9-day and stocks, this doesn't apply as much because stocks are much tended to not move up this quick. This is definitely something for crypto currencies. Okay, so for stocks would probably be something like the 50-day because they're, not gonna move up as fast as a cryptocurrency in most cases.
The next thing I want to talk about is a topic pattern. Now, what is a topping pattern? Well, we've got one right here in this amigo chart. Tell me what candle on this chart. I want to get you thinking real quick, because I don't want to just tell you things.
I want to ask you all what candle on this chart looks like a topping pattern. I'll. Give you a second well I don't know what candle you picked. Cuz! I can't hear your voice through the screen. However, I will assume that you guessed this candle and if you did, you are absolutely correct.
This is what's known as a topping pattern. Now everyone will tossed every names at it, but this is generally what is known as the topping pattern in technical analysis. Now you can probably guess why it's called a topping pattern.
If you know how to read a candle chart and if you don't, I recommend you start using Canon charts folks. I know a lot of people in these line or area charts. Candle charts are the way to go in this case.
With a topping pattern, you can see that the wicks of the candle is well over two to three times the actual gain of the day, and what that means is that a lot of this gained price action closed downward.
It was complete FOMO. That means that buyers were coming in too quick and then they realized that it wasn't fundamentally sound in the sense of that price action. So it pulled back and because of that that speaks of over exuberance, it speaks that there wasn't enough either enough volume there wasn't enough reason for it to move up, and because of that, it can make the chart.
Look very ugly. I know that sounds silly, but because of that, it can lead to a lot of sell side, and it can really say goes to the market that something is overbought, that something is being a little too over exuberant.
As we all know, as I repeat, a thousand time over exuberance can make up all the difference in just a few days or weeks, and we're, seeing that right now with whom you say go so again, when you see a candle like this, Especially for those low volume, crypto currencies that as much as I told y'all not to trade.
I know some of you want to go out there and trade do not chase crypto currencies that have these really long, drawn-out wix's. You want to see candles like this that have full green bars that continue to go up and confirm price strength.
Confirmation you do not want to buy into something like this. So again, you really want to make sure that the candles have solidified price action. A lot of good, healthy, green candles and, of course, they have healthy Corrections as well.
Not these topping out wix's where the wicks itself makes up more than two to three times the standard price action of the day, all right. So the last thing I want to talk to you all about, and of course, this doesn't always apply to all cryptocurrencies it's, just a simple signal that you can look for in the sense of technical patterns.
It's, a head and shoulders pattern. Now we've talked about this on my channel before, however, today I want to go ahead and talk about it specifically inside of me say: go again all three signals that I want to talk about today.
We're, founded on me, set, go it's quite simple, so we're gonna go ahead and use the drone to. I recommend use it using a line tool, but in the case of tradingview it's. It's very drawn-out, but here we go in the sense of drawing it simply.
We just have to draw the first shoulder the head and then the other shoulder okay. So this is a very common drawing pattern in crypto currencies and stocks, any financial investment vehicle you'll, find a head and shoulders a lot.
Now a lot of people will call in Elliot waves. A lot of people call it. I've, been hearing so much about Elliot waves. I don't, get what the craze is about that but anyways in the case of head and shoulders.
It's, a very common pattern and it really looks like head and shoulders it's pop it's. Really much like you know, going up your shoulder going up your head bouncing down again and then going down to new lows.
As you can see, the selling is starting to pick up on a Mesa go because people are realizing. This is a head and shoulders and you & # 39. Ll, find us a lot in other cryptocurrencies that are topping out or have had ridiculous run.
Ups like owe me a go: it's gone up more than 10 %. It needed a correction. Okay, so you & # 39. Ll find this a lot when there's so much strength behind something, but after a while this steam runs out, the volume stops flowing in the price is too overbought.
So again, look for these kind of Head & amp Shoulders. Patents and, ironically, you & # 39. Ll find this a lot in these topping patterns. You & # 39, ll, find it when it starts to roll over, and it has that almost kind of dead cat bounce and it's like we're gonna get back to those highs.
Don't worry about it and then you get caught in the bear trap and you get pulled down and of course you start losing your profits. So these are three great signs you can use to start. You know timing the market a little bit better, locking out of your profits, knowing when to get out a little bonus tip is well, and I & # 39.
Ve mentioned this in the past. I feel like it'd, be important to mention it notice where a Mesa ago stopped really getting bought out and of course we had the wicks go up here, but sometimes you have to look for the big evens 300,000.
Was the resistance point really? I think that was the big, even as you can see the candles over here, couldn't get past it, and when I try to get past there, it couldn't remain over 300,000. The fourth tip I'll.
Give you on this kind of a mini tip is look for the big evens. You all know. I talk about this a lot, but I thought I'd, toss it in there, because that's, a great way to know when to sell something: okay, because the whales are going to sell at the big evens 300,000.
In the case earlier at, I know that, for example, 200,000 was a huge resistance point. There's, a lot of sell side action at these levels and because of that, you want to lock in your profits a little bit beforehand, so it might have been smart to lock in some profits here before 300,000 on these days again be ahead Of the game use strategy, use these technical analysis, skills tools and patterns to stay ahead of the game against the competition, and I can promise you you'll, have a much higher chance of on top well folks that's, it for The video thank you all so much for watching.
I hope you enjoyed these tools and all the things that are shared in the video. If you do enjoy the video please drop a like and leave a comment down below. If you want to see another training, tip video and a certain topic covered on the training tip series, I always love getting your feedback, but until then everyone, I will see you all in the next video stay tuned.