Best Cryptocurrency Trading Strategy - MACD is one of the best strategies which you can use while trading bitcoin, forex, and stocks. It is a great strategy both for day trading and swing trading. Make sure to subscribe for more trading strategies videos!

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Hello everyone. I hope everyone is doing okay and enjoying the bull market.

Today, I will teach you one of the most effective strategies of cryptocurrency trading which you can start to use today. You can use this technique both while day trading or swing trading. your chance of making consistent profits while trading bitcoin is way higher With this method.
Please note that nothing in this video or in this channel is investment advice and the trading journal channel is not responsible for any kind of loss.

Remember that before starting to use any strategy you should backtest it. Don’t believe that a simple strategy can make you a bitcoin millionaire just because some YouTube trading mentor told you so and go test the strategy for yourself before losing money.

So let’s talk about the strategy. If you are not a new trader, you must be familiar with the indicator MACD. If you have never heard of it, don’t worry. We will take a look at what does it mean. MACD stands for Moving Average Convergence Divergence which is not the most effective way to say it.

MACD is a leading trend-following momentum indicator which uses two different exponential moving averages. As you can see MACD uses 12-Period EMA ? 26-Period EMA

But the main advantage of MACD comparing to moving averages is that moving averages just indicate trend while MACD indicates both the trend and the momentum. Because MACD shows us the momentum it shows us the strength of trend and that is why it is one of the most used indicators by traders.

First I will show you how to read the MACD indicator. To check the MACD indicator I will use the site Tradingview.com which you can use for free. After opening trading view you can add an indicator clicking this button. You can search for any indicator you like.


As you can see, MACD has one blue and one red line and it also includes some red and green bars. The zero point is our base line. The red line is called the signal line and the blue one is called the MACD line. Reading MACD indicator is simple, when the blue line crosses up the red line below zero-point, it is considered as a buy-signal and when the blue line crosses down the red line over zero-point , it is considered as a sell-signal. But we should be more picky and try to look for signals that are far from the base line. Also we can never trade trusting just one indicator.
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Now let's take a look at the bars. Bars show us the difference between the two lines. It can be hard to see, but when you check the base line point you can easily see that the height of the bar equals to the difference between two lines.
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At the beginning of the video, we saw that MACD uses two different Exponential moving averages. So blue and red lines are 12-Period EMA and 26-Period EMA respectively. That means, bars represent the difference between two EMA’s. So, bigger bars mean strong momentum and the small bars mean the loss of momentum.

Now, you know how to read the MACD indicator. But you should never trade using one single indicator. The best way to use an indicator is to use it with other technical analysis tools, such as candlestick patterns or other indicators.

The MACD indicator has one big disadvantage. The MACD indicator by itself is not enough to identify the true-long term direction of the trend. If you want to be a great trader in the long run you should always be trading in the same direction as the trend. You will be most likely to lose money if you bet against the trend. To identify the long-run trend, we will be using the 200-period-EMA.

In our strategy, we will have a couple of rules to follow in order to avoid mistakes. We have 3 basic rules which will make us picky but, they will increase our win ratio. Our first rule is to only open a trade when the MACD signal and the trend are in the same direction. Our second rule: we should only take trends when the crossover points of MACD lines are far from the zero point. Our last rule is really simple but I think it is one of the most important rules for any kind of trade.